Euro continues to take a fall

Forex Trading Nigeria

Home | Live trading | ( 2 ) | Subscribe

Posted by on Thursday July 19, 2012 10:22:49:

There is still much instability in the eurozone that keeps the bears in hold since the last quarter of 2011. The euro has continued to take a fall from as high as 1.4 against the US dollar to 1.2 now in July 2012.

For those trading the euro, it may take some time before the currency becomes volatile again and predictions are already on that there is still more fall to come to make it at par with the US dollar. If the euro continues to depreciate amidst uncertainty and gloom in economic outlook of the eurozone, we could see the euro as low as 1.0 to the dollar by Q4. The USD is already growing stronger and unless there is FED action to make it weaker than the euro, it may keep gaining strength for the long term.

Should one buy or sell the euro now? Well it depends on you. Buying is good if you can hold for the long term as the price is already below its lowest point for more than 2 years. Day trading the euro may be much safer as more updates on the zone get reported. However if you are trading for long term, you can buy on dips to see if we could reach 1.3 again within a year.

Personally, I already made some losses trading the euro this year but it's always good, whether you are buying or selling not to sink all your capital in one trade. Try to buy or sell at moving intervals rather than at a spot price. For instance, if you intend going long on the euro, you can buy at 1.23 and then 1.20 and again 1.19 if it gets low as that. Euro should appreciate shortly by the time eurozone gets it act right. Shorting it would not be safer for the long term.