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by Austin Passamonte
Here's a long-term chart view of the euro currency futures contract.
Position: N/A
Austin Passamonte
Austin is a private trader who trades emini stock index futures intraday. He currently trades various futures markets from home in addition to managing a trader's educational forum
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TECHNICAL ANALYSIS
Dollar Discount
08/14/09 09:08:27 AMby Austin Passamonte
Here's a long-term chart view of the euro currency futures contract.
Position: N/A
| The US government may talk incessantly about a strong dollar policy, but actions speak truly where mere words do not. |
|
| FIGURE 1: EURO/USD FUTURES CONTRACT, WEEKLY |
| Graphic provided by: TradeStation. |
| |
| The US dollar (USD) has sold off steadily while the euro (EUR) rallied since the double-bottom lows of late 2008-early 2009. The pronounced W-shaped price formation covered some -2,500 pips down, +2,500 pips up, -2,000 pips down and +2,000 back up. At $12.50 per pip value on each EUR/USD futures (6E) contract traded, those are some impressive swing ranges. See Figure 1. |
| In 6E, the 1.4500 range is the next overhead congestion visible. If and when it pops through there, look for some real magnetic attraction around the 1.4900+ zone. Several layers of congestion reside there, including a weekly pause in the early stages of that plunge crossed by a +162% projection magnet from the most recent 1-2-3 ascent off lows. |
| Breach that ceiling and the peak EUR swing highs of the 1.60s are likewise +233% projected targets from the bottoming pattern. The EUR is semicorrelated to stocks per the USD influence. A weak USD = strong EUR means higher corporate earnings potential for stocks outside the US. Keeping an eye on currencies and stocks in tandem via long-term charts helps map where each is likely to go, be that lead or follow fashion in unison. |
Austin is a private trader who trades emini stock index futures intraday. He currently trades various futures markets from home in addition to managing a trader's educational forum
| Title: | Individual Trader |
| Company: | CoiledMarkets.com |
| Address: | PO Box 633 |
| Naples, NY 14512 | |
| Website: | coiledmarkets.com/blog |
| E-mail address: | austinp44@yahoo.com |
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Date: 08/16/09Rank: 2Comment:
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