XEU Euro Weekly Chart Sideways Channel Inverted H&S

Up euro means up markets. With a recession ongoing in Europe and a depression in Spain and Greece, and no growth, the euro must be weakened to help boost manufacturing and exports. However, tell that to Draghi. This morning he is saying its all blue skies and rainbows. The euro is up again today. The daily chart is overbot and negatively diverged wanting to see a pull back.  The weekly chart above agrees as well (red lines) but there is short term momo as shown by the short green lines. The pink lines show an inverted H&S with the neckline at 135-ish exactly where the euro is now. This is a major battle level since once the neckline is violated to the upside, the upside inverted H&S target at 149-ish would be in play. At this juncture the inverted H&S may not be the path forward. Both th eeuro and the dollar will likely continue with sideways behavior. The euro should pull back in the coming days but continue to move thru this 132-135 range for a week or two then perhaps leak steadily lower, overall moving thru the blue sideways channel at 127-137 for the forseeable future. A downward bias is much more likely over time since Draghi will have to lower rates and weaken the euro perhaps at the 2/7/13 or 3/7/13 meeting. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.