Great Graphic: Euro Holds Monthly Downtrend Line

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.