The Russian ruble has come under attack due to tensions in the Donbass. An exchange of sharp remarks between representatives of Donbass, Moscow, Kiev and Washington actualized the sanctions risks. Investors are again returning to the agenda a tightening of the sanctions regime, which could damage both the economy and the normal operation of financial markets.
As a result, USDRUB jumped above 78 per dollar – the highest since the beginning of November last year. EURRUB at some point climbed above 92.60, which is very close to all-time highs.
Traders with the ruble should keep their finger on the pulse of events, discarding technical and fundamental analysis for a while. Now is one of those periods when politics rules the show.
At the same time, the technical picture is still more on the side of the bulls: the ruble was also oversold at the very border of the established trading ranges in recent months against the dollar and the euro. More recently, the outlook for $ 70 per dollar by the end of April looked very real. Well, it looks like the plans for a massive ruble growth will have to be postponed.
Under normal conditions, it would make sense to look for signs of depletion of the bullish momentum in currencies against the ruble. In addition, the dollar on Forex turned to decline after three months of growth – this is a good breeding ground for the ruble, commodity prices and the demand for risks in general.
But, unfortunately, political statements or events can all too easily break the ruble’s position, spinning its dynamics out of control. Especially with caution, you need to watch the dynamics of EURRUB on the way to 95. A break above could trigger a massive impulsive sell-off. If the weakening of the ruble gets support, then when USDRUB goes above 80, the amplitude of the fall of the Russian currency risks becoming especially frightening.