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Tags: Johnson | parity | future | euro

Piper Jaffray's Johnson: 'Parity Is in Future for Euro'

By    |   Wednesday, 21 January 2015 11:20 AM EST

The euro hit an 11-year low of $1.1541 against the dollar Wednesday amid expectations the European Central Bank will launch a new round of quantitative easing Thursday.

And many experts think the single European currency will fall much further.

"Parity is in the future for the euro," Craig Johnson, senior technical research strategist at Piper Jaffray, told CNBC and Yahoo Finance's Talking Numbers. Parity would mean the euro trades at $1.

"It's in everybody's best interest to see that currency [the euro] cheaper, so they can improve their exports. And it's ultimately positive for the entire globe," he noted. A weaker currency boosts a nation's exports by making them cheaper in foreign currency terms.

The euro traded at $1.1590 Wednesday morning. It touched a record low of $0.8252 in October 2000. It hasn't traded below $1 since December 2002. The euro began trading in January 1999.

"Since about 2003, we've been making a big distributional top" for the euro, Johnson explained. "We broke through key support at about $1.20. The next real support comes in around basically $1.05 to $1.10."

Meanwhile, ace investor Jim Rogers has been a buyer of dollars, even though it's a "terribly flawed currency," he said, according to Investment News.

"I own more dollars than any other currency, as I see more [global] problems coming," Rogers explained. "Currency turmoil has already started and will continue for the next three to four years."

The dollar has reached multi-year highs against a range of currencies in recent weeks, and the Swiss franc has soared since the Swiss National Bank decided to drop its ceiling for the currency last week.

"When people are scared instinctively they run to the dollar, as it is perceived to be a safe haven even though it is not," Rogers said.

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Finance
The euro hit an 11-year low of $1.1541 against the dollar Wednesday amid expectations the European Central Bank will launch a new round of quantitative easing Thursday.
Johnson, parity, future, euro
299
2015-20-21
Wednesday, 21 January 2015 11:20 AM
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