We Could See A Euro Bounce Soon
- Posted by JC Parets
- on November 13th, 2012
This summer the pessimism surrounding the Euro was incredible. For us technicians who study the behavior of market participants, we love to see something hated as much as the Euro was. And sure enough, we had a monster rally come off those July lows (See here). But since mid-September, the correction has definitely been on.
How low do we go? Not sure, but I do think this would be a logical area for the $EURUSD to find some support. Take a look at the January lows, and then the resistance that it turned into in June. After the breakout, that support that then turned into resistance could once again become a nice support level. Combine that with a range between the 38.2% Fibonacci retracement and 50% retracement from July to September move, and we have a potential cushion here:
The Relative Strength Index reached extreme overbought levels in September, which signaled to us that there is strong evidence of buyers. If we are indeed in a bull market for the Euro, then RSI should be able to find support here. I think the Euro’s behavior over the next few weeks could tell us a lot about the bigger picture in this space.
Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.blog comments powered by Disqus
J.C. Parets is the Founder & President of Eagle Bay Capital, LLC. He earned the Chartered Market Technician designation (CMT) in 2008 and now actively manages money incorporating Technical Analysis and Behavioral Finance into his practice More
- Is JC Penney Setting Up For Another Leg Higher?
- Audio: Q&A on Benzinga Morning Show
- A Look At Energy On Multiple Timeframes
- Yahoo Runs Into Historic Overhead Supply
- Join Me On Benzinga’s PreMarket Prep Show 9/16 9AM ET
- Semiconductors Selloff After Failed Breakout
- Tesla Breaks Down From Traditionally Bullish Pennant
- A Multi-Timeframe Look At Mid-Caps
- Here are 4 of My Favorite Charts in the World
- IBM Likely to Break Higher Out of this Range
Archive by Year