Commerzbank’s Antje Praefcke expects EUR/USD to remain in sideways trading as multiple uncertainties limit conviction in either direction for the Dollar. She highlights the Middle East war, the unclear path for the next Fed Chair and policy, and possible delays to Warsh’s confirmation. Overall, she sees a slight bias toward a stronger US Dollar in coming days.

Dollar rangebound with slight upside bias

"At the moment, there are simply too many unanswered questions to provide a compelling reason to push the dollar significantly in one direction or the other. I fear this will remain the case in the coming days, with sideways trading prevailing in EUR/USD."

"Since there are no signs of a renewed escalation that could drive the dollar much higher, but also no foreseeable end to the conflict - which in turn could lead to dollar selling - a “wait-and-see” approach makes sense for the market."

"Given all these uncertainties and unanswered questions, the safest option for now is to trade sideways and wait for the next developments. I see a slight bias toward a stronger US dollar as long as no new talks between the US and Iran are scheduled, since uncertainty surrounding the Middle East conflict has increased somewhat again."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)