European Currencies Face a Crucial Test: What to Expect

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The end of June and the beginning of July are packed with significant economic and political events for the pound and the euro. A few weeks ago, Emmanuel Macron dissolved the parliament and announced snap parliamentary elections. He took this step after the far-right National Rally led by Marine Le Pen secured first place in the European Parliament elections. Many experts believe that if the far-right gains a majority in the parliament, it could lead to a serious political crisis in the EU, consequently exerting bearish pressure on EUR/USD.

EUR/USD

According to the technical analysis of the EUR/USD pair, if the price falls below 1.0660, the pair may continue its downward trend towards 1.0600-1.0400. A resumption of the upward trend is possible with a confident consolidation above 1.0740-1.0700. In the upcoming trading sessions, the following events should be noted:

  • Today at 12:00 (GMT +3:00) expected consumer inflation in the Eurozone;
  • Today at 13:00 (GMT +3:00) special EU summit of heads of state;
  • Today at 15:30 (GMT +3:00) US GDP.

Read analytical EUR/USD price forecasts for 2024 and beyond.

GBP/USD

Similar political uncertainty is observed in the United Kingdom. A month ago, Prime Minister Rishi Sunak announced that he had asked King Charles III to dissolve the parliament and scheduled general elections for 4 July. The upcoming political battle sees the GBP/USD pair near 1.2600. If sellers manage to break this level and consolidate below it, the downward trend may continue towards 1.2550-1.2460. A reversal of the bearish scenario is possible if the price moves above 1.2700. Important events for the pair's pricing today and tomorrow include:

  • Today at 12:30 (GMT +3:00) speech by Bank of England Governor Bailey;
  • Tomorrow at 09:00 (GMT +3:00) business investments in the UK;
  • Tomorrow at 09:00 (GMT +3:00) UK GDP for the first quarter.