Looking ahead

Moody’s Guest expects the euro to remain largely range bound over the near term, with a year-end forecast of $1.27.

Other analysts say actions by the U.S. Federal Reserve could be key for the euro. While the market has not priced in this expectation, Mazanec expects the FOMC to hike rates again in the third or fourth quarter. He says that would send the euro back to the bottom of the range.

Mazanec says euro resistance above $1.30 could limit the upside for the currency.

Naomi Fink, director of FX strategy at BNP Paribas, is the most bullish on the euro.

“It is only a matter of time before we are looking at an upside breakout of $1.30,” she says. “It is hard to see foreign investors finance the U.S. current account deficit at the current low-yield levels.”

Fink sees potential for the euro to move as high as $1.35 by year-end.