TechnoMeter

Is the euro there yet; that is, has it arrived at a point where it could undergo a correction, or worse? It’s certainly in an area where a turnaround could develop. There is a trend-line running down from the top in 2008, clocking in around the current vicinity to a little higher. For a time-frame this long, you need to pull out the monthly chart and use a crayon versus a pencil to draw the trend-line. When you look at this way, then EUR/USD is trading up against a critical spot near the 12600-handle.



On Thursday, we saw a strong key-reversal bar carved out. If the high of the candlestick at 12537 isn’t soon overcome, look for the euro to begin trading lower in the days ahead. These types of powerful reversals tend to lead to turnarounds fairly quickly, however; in the event EUR/USD moves sideways, with each passing day, the likelihood increases that we’ll see a breakout above.

more...