The Euro to fall to parity: The bleak outlook continues as euros shorts increase

Euro headed to parity according to Bloomberg 

I came across a piece this am on the Market’s Live Blog making a case for parity on the EURUSD pair. The pair currently sits at 1.0835 and so it would need a move of ~8% to move down there. 

EURUSD falling

Reasons for EURUSD parity

The EURUSD pair has been at parity before with the most recent times in 2014 and 2015 and there is plenty of reason to think that could continue again: 

1. The eurozone economy is weaker than in 2014 and 2015. The slow drag on the eurozone economy is set to remain too with the potential for supply chain disruption from China and Brexit negotiations carrying on in its usual combative and confused state. 

2. Bond yields are paying less than in 2014 and 2015

3. ECB’s main interest rates are lower than in 2014 and 2015

EURUSD sell on rallies. 

With EURUSD having broken through key support any return back to 1.1000, 1.10500 and 1.1200 look suitable for sellers to re-engage short positions in the medium term. 

EURUSD buyers