This Great Graphic is the monthly bar chart of the euro. It was constructed on Bloomberg. It shows that the euro has been turned back from a monthly trend line drawn off the 2008 record high and the 2011 high near $1.50.
The euro's demise has been long foretold, including by ourselves. It was the ECB's reluctance to ease in early March that broke the dollar out of its five-cent/five-month trading range between $1.33 and $1.38 and set up the test on the trend line.
With the backing up of US yields and the continued dovish push by Draghi, as he ostensibly tries to build a coalition in favor of taking unconventional measures, the euro has returned to its former range. Nearby support for the euro is pegged in the $1.3640-80. A break would could spur a move toward $1.35, but if that trend line does indeed remain intact, over the longer-term, the euro would be headed back toward $1.20.
Great Graphic: Euro Holds Monthly Downtrend Line
Reviewed by Marc Chandler
on
April 04, 2014
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