The Euro continues its sorry decline towards two bands of support: the first is a reaction low at $1.2921, the second is a thicker band running between $1.2350 and $1.2500. The latter is a more logical buy point given psychological support at $1.2500 and its prior hold in late 2008 and early 2009. Given the rate of the current decline it would appear unlikely any of the PIGS club-Med countries will have their business in order prior to such tests.
The issue isn't so much when will the Euro will reach $1.2500 but what will happen when it does. Given the scale of their respective economies (and subsequent influence on the Euro), will Spain or Italy swallow the bitter pill needed? Without the hard decisions it will be hard for the Euro to defend $1.2500.
For the record, I have created a EURUSD Trading Idea for a push to the first Target level with a stop on a break of the downward channel.
The issue isn't so much when will the Euro will reach $1.2500 but what will happen when it does. Given the scale of their respective economies (and subsequent influence on the Euro), will Spain or Italy swallow the bitter pill needed? Without the hard decisions it will be hard for the Euro to defend $1.2500.
For the record, I have created a EURUSD Trading Idea for a push to the first Target level with a stop on a break of the downward channel.
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