Euro Stoxx Banks Index Daily Chart; European Banks Collapse to 1987 Levels; Descending Triangle

In Europe there are five banks on every corner. The financial system has needed to consolidate banks for the last few decades but the status quo continues resulting in a potentially dire outcome. Many folks are employed by the banks and consolidation would lead to layoffs. Politico's worry that people without jobs become angry, sometimes violent, and they do. The Euro Stoxx Banking Index is at levels not seen since 1987. Global market participants continue to assess the potential damage of the negative rate environment year after year; these are uncharted waters.

The most worrisome aspect of the situation is the ominous red descending triangle taking one decade to form. Typically, if a descending triangle breaks down, it moves a distance lower equal to its vertical side. With the index at 93-ish, a 150-point collapse is not even possible.

Suffice it to say that if the red base line fails, the European banks and economy are toast and of course this will impact the rest of the world. Price has bounced off this multi-decade line in the sand before. Will the banks bounce again or will the descending triangle crush the European banking system sending them into Hades? 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.