Euro Breaks Down

From last Fri Nov 18 post
The Trillion Dollar Question ..Eur/USD

"It needs to accelerate one way or the other.
Breaking out of the range will signal the tell; 138 and 134. Again right in the middle of it.
Common sense would suggest that with all the turmoil in Europe the euro is doomed, but here it is at an unlikely 1.35.  
The highs put in last April/May in almost all assets were significant, and lend weight to the interpretation as depicted in the labeling above, implying another series of ABC's down.
 ABC structures frequently have equal (or nearly) legs; that would target 108."

It broke down this morning to new lows under 134. That's the tell mentioned above.
Additionally, the Euro has broken below the .78 retrace of the lesser x wave. Just.
click to enlarge
Next milestone on the downside is, of course, the overlap of the previous low and beginning of the x wave, at 131.42

The support at 134 was not only horizontal support from Nov. 18 as seen in the daily and hourly chart, but also a 50% retrace of the entire X wave, of larger degree , as labeled on the weekly chart.
click to enlarge
Note that overlapping the 131.42 low would leave very little between it and the next support, .618 of the X wave , at 130.33.
Below 130.33 no real support before the previous low of Jan 10 at 128.70.
Overlapping that level and you're really looking at the lows of 118 for support.


Popular posts from this blog

WTI Update- a 4 Handle Future?

Biden Climate Plan and Global GDP

Gasoline a By-product of Distillate