Euro-dollar going to 1.20, not parity: Strategist

Will the euro head lower?

Currency experts expecting the euro to reach parity with the U.S. dollar have been labeled "tiresome" by David Bloom, the global head of foreign exchange strategy at HSBC, who sees the two currencies moving in opposite directions.

"The big bull runs in FX (foreign exchange) is into rate hikes," he explained to CNBC on Tuesday. "I don't want to be buying dollars now...I think the dollar bull run is over."

When will the Fed raise rates?

Euro-dollar parity has been one of the main topics in the world of foreign exchange this year with the two central banks differing so wildly with their policymaking. The U.S. Federal Reserve continues to mull over an interest rate hike this year, despite failing to move so far, but the European Central Bank has spoken of extending its asset purchases.

A rate hike, and the potential for a higher yield on the dollar, are seen as bullish for the greenback, but Bloom argues that any upside has already been priced in. Additionally, he believes a dovish move by the ECB will fail to lower the price of the single currency. He notes that the political wrangling in Greece this year, and the emissions scandal at Volkswagen, has had little impact on the euro.

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"That interest rate argument which was so wide between the ECB doing QE (quantitative easing) and the Fed's going to raise rates this year...those arguments have kind of crumbled, and I think from a monetary policy basis they've gotten closer together, and that's why I think euro-dollar will drift upwards," he said.

The euro was trading at 1.1064 against the dollar on Wednesday morning after turning sharply lower last Thursday when the ECB's Mario Draghi spoke of negative deposit rates and the potential for more QE in December.

The surprise move led a host of analysts to produce new predictions on the currency cross, suggesting the euro might trade at the same price as the dollar in the coming months.

Jane Foley, senior currency strategist at Rabobank, told CNBC Tuesday that she didn't completely agree with Bloom's thesis and said the euro is "still likely to be soggy."

'Perfect storm' to lead to euro-dollar parity by December?

Investors and traders made large short positions on the euro this year, taking bets that it would lower in price, she explained. But, she added that a vast proportion of these short positions had now been closed.

"We have to ask the question 'does the market really want to go 'long' euros in this environment?,' particular with the ECB potentially doing more on policy as early as December," she said.

"I would say possibly not," she added.