The Euro CurrencyShares Euro Trust (NYSE:FXE) has been consolidating at the lows of the daily chart over the last couple weeks. While it is clearly trying to make a bottom, one must be very concerned it does not break through the support. The major support on the Euro can be viewed on the FXE at $121.50. The Euro is lower again today and under pressure.
The pattern on the Euro is beginning to become bearish. There has been little to no bounce and the movement at the lows of the chart signal a possible short term break down quickly approaching. Should this happen, the markets will continue to remain under pressure after this latest bounce.
In tune with that, the U.S. Dollar PowerShares DB US Dollar Index Bullish (NYSE:UUP) continues to hold near the highs of the chart. Should the Euro break through the support level on the FXE at $121.50, expect the Dollar to rush higher.
Gareth Soloway
Chief Market Strategist
InTheMoneyStocks.com
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