Ukraine crisis: Russian ruble vs the euro
22nd February 2022 07:35
by Alistair Strang from Trends and Targets
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As Russia orders troops into eastern Ukraine, independent technical analyst Alistair Strang studies the implications for currency markets.
The other storm providing a worry, obviously, is the current Ukraine crisis, so we've decided to review how the markets are handling the currency relationship between Europe and Russia.
Thankfully, the picture, while interesting, isn’t screaming drama. The immediate situation suggests above 90.9 looks capable of allowing the euro to strengthen to an initial 94.54, such an ambition challenging the prior highs of 2020. Should such a level be exceeded, our secondary calculation comes along at 97.94 and, again, this suggests a visual challenge against the strange high of 2014.
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The visual conclusion from the above is of the euro strengthening against the ruble but not really doing anything it hasn’t done before.
Source: Trends and Targets. Past performance is not a guide to future performance
We ran the same exercise against the US dollar, finding a very similar set of results, with the ruble weakening but not to any new degree. Even tossing sterling into the mix brought a suggestion of some ongoing sterling strength to 115 against the ruble, a level slightly below the highs of 2016.
If true dramatics are upon us, for the EUR/RUB to justify a raised eyebrow, above 97.94 should provide real justification, this suggesting the pairing is heading somewhere brand new.
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
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