XEU Euro Weekly and Daily Charts

Euro charts clearly show the oversold conditions, falling wedges and positive divergence that launched the euro a couple weeks ago. Since everyone, including the taxi cab driver, is short the euro, the short-covering rocket fuel catapulted the euro higher. It's a tough nut to crack due to all the central bank intevention and other debt drama shenanigans. Germany remains the European powerhouse and strongest nation although its economy is languishing over recent weeks. A lower euro will help Germany improve which would, in theory, help resolve the Euro debt mess.  A strong Germany is key to Europe ever recovering.

Markets have moved according to the following asset relationships; euro up = dollar down = copper up = commodities up = equities up and visa versa, euro down = dollar up = copper down = commodities down = equities down. The euro is fighting for the 50-day MA at 124 so keep an eye on that level.  Watch the ADX green line which remains under the red line which will drag price lower. There is a huge gap big enough to drive a truck thru between 124.4-126.0, so a price move above 124.4 will likely open the door to 126.

On the weekly chart, price came down so close to the multi-year low at 120-ish it is hard to imagine that price will not test this area.  Keystone's 80/20 rule says that prices move from 8's to 2's and 2's to 8's, so the failure of 122 should lead to a look at 118. The weekly chart is agreeable to this current area serving as a base, but, with all the inervention and Euro drama continuing, there are too many extraneous factors at play that can hit the tape at anytime, so anything can happen.  The 200-day and 200-week MA's are both sloping negatively which is a very bearish indication.  The 20-week MA is under the 50-week MA which is bearish. A lot of the currencies and yields may surprise traders with their flatish moves over months and years to come.  Projection for the euro is a continued move thru 117.7-124.4, now near the top of the range. A move above 124.4 likely leads to 126 and higher. 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.