The Euro/Dollar pair took again the major trend direction this week. After the increase of the Euro for the last week which was partly supported by the weekly and the daily graph, now it's again on the downside. During the weekend the news that a major Spanish bank - the Roman Catholic Church-controlled savings bank CajaSur, was took over by the central bank of Spain hit the Euro and made it fall on two consecutive days. Now it trades around 1.2230/40 against the US Dollar.
The weekly Euro/Dollar graph (click on it for a better view) doesn't show any strong upside support for the Euro. Both MACD and Stochastic are pointing down. Such movement could continue at least till Stochastic shows the Euro is too oversold. The current market sentiment is negative towards the Euro and every news about even potential problems in the EU zone could trigger further selling.
There are market rumors on possible ECB intervention but one shouldn't count on that as such a move is mostly hypothetical. However the more oversold the Euro gets, the higher becomes the possibility of volatile movements and explosive ups and downs. The reasons for such movements could be different and could include a possible intervention - either by decreasing the amount of Euros available on the market or by increasing the amount of Dollars.
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