Dennis Gartman, hedge fund manager and author of The Gartman Letter, told CNBC today that the Dollar will stay at around 1.40 against the Euro.
EUR/USD will stay around 1.40 for some time as both currencies face downward pressure and the Euro is resistant to bearish news.
The following are Gartman's key conclusions:
The Dollar seems to be happy at about 1.40 versus the euro and I think it is going to stay for quite some period of time.
There are so many problems incumbent on Europe that should put downward pressure on the Euro, but also many problems going on with the Dollar that will put pressure on it, that I think they will stay stable.
The oldest rule that traders learn is that if something isn't going down on bearish news, it is not going to go down.
The Euro didn't go down on the downgrading of Greece debt, and that may mean we are giong to stay right here.
The ratings agencies took a black eye during the credit crisis so now they're trying to get ahead of the news.
The problem is that everyone knows about the news already, even the guys I play golf with who don't know what's going on in the world.
The EUR/USD is currently trading at 1.4280 down 160 pips on the day.
The Greece crisis continues to weigh on the EUR/USD following news from Luxembourg Finance Minister Frieden stating that New Greek aid may be delayed until July.
Also, risk appetite seems to have been rattled by comments from Ben Bernanke who warned that if the US's $14.3 trillion debt ceiling is not raised, a potentially disastrous loss of confidence in its creditworthiness could result.