That’s the way it was until Friday, when a key Spanish interest rate crept back above 7%, refueling the thought that the banking problems were not going away. With the Euro finishing in a weak position to end the week, most short traders went home with the feeling that there was enough downside momentum in the market to drive the Euro even lower this week. This thought was affirmed when over the week-end came the news that the International Monetary Fund was set to stop aid for Greece. This was a huge blow to the country trying to get back on its feet because it could push the debt-stricken nation into bankruptcy.
Weekly Nearby Euro Pattern, Price & Time Analysis
Technically, the weekly Nearby Euro futures chart shows no sign of bottoming. The nearest swing top is 1.2759. Only a breakout through this level will turn the main trend to up. The single-currency is also walking down a downtrending Gann angle from the 1.4925 top. This angle is at 1.2365 this week. If the Euro continues to move down at a pace of .004 per week, it should reach the June 2010 bottom at 1.1849 by late October.
Overnight the Euro gapped lower on the opening, demonstrating pent-up selling pressure and an immediate reaction to the bearish IMF/Greece news released over the week-end. Downside momentum could pick up throughout the day with the only hope of a rally coming after the market reaches a technically oversold level.
For more information, please visit: http://patternpricetime.com.
