Friday, January 23, 2015

XEU Euro Daily Chart 11-Year Low

The euro daily chart is bludgeoned lower with ECB President Draghi's baseball bat. Draghi is running the printing presses non-stop flooding the world with euro's. Grab some and buy stocks. Everyone else is. The euro falls like a stone after the ECB QE announcement from above 1.1600 to 1.1166 an over -4% drop.

The stochastics are oversold and positively diverged so they will work to create a bounce. The other indicators are weak and bleak but much of the beating is already priced-in since the indicators are buried in the cellar. The RSI is down to 15, MACD -2 and lower, and ROC -5.4. Once you get so low there is no where to go but up. So a bounce woudl be expected but the indicators will want a lower low until they can set up with possie d.

The red dots show price extended to the downside so a mean reversion will be required (bounce). Price would be expected to stabilize sideways but a few more days will be needed first with the euro likely printing under today's 1.1166 for a lower low next week. The indicators will set up with positive divergence in the coming days and that will identify the firm near-term bottom for the euro. 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.

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