Euro: It Can’t Get Any Worse! Or Can it….?

By Casey Stubbs — Join Casey in the $2500 Currency Trading Challenge

 

The Eur/Usd had a huge drop this week!!!! Yes it dropped 41 pips, after all the talk, after all the downgrades, after all the drama, the Eur/Usd currency pair fell a whopping 41 pips. It closed last week at 1.2721 and closed this week at 1.2682. The pair actually opened at 1.2687 and closed at 1.2682 so actually it only was down 5 pips. Now I believe that market sentiment is what moves the market and that is why the Euro is down so far right now. One thing to remember is that the media and the market participants are very fickle, which means they can love you one minute and hate you the next.

So lets try to look at what events could cause a shift in current market sentiment:

  • They will get tired of reporting only about the Euro, and eventually people will see that the Dollar is not in any better shape than the Euro as a matter of fact the U.S. is just a bad off or perhaps worse than the Euro.
  • The U.S. Government is in 14 trillion in debt which is greater than any other country in the world.
  • On top of our tremendous debt that we cannot control is the fact that the fed wants to print more money QE3
  • U.S. Unemployment is causing less taxes to be collected add that the fact that the debt is growing means that the debt will keep spiraling out of control.

Yes the Euro Stinks, but have people really forgotten about the dire condition of the Dollar? You know the saying the bigger they are the harder they fall. I think we will see a fall soon. Watch this video that truly describes the ignorance of most Americans and mainly the ignorance of the government. Last week I called a Euro bounce and I am sticking with me analysis until It goes against me 🙂

 

Weekly Chart:

 

Read another weekly analsyis at Forex Abode

The following two tabs change content below.
Casey Stubbs is the founder of Winners Edge Trading, which is one of the most widely read forex sites on the web. Winners Edge Trading has trained thousands of people to trade the Forex markets.

Winner’s Edge Trading, as seen on:

Winner's Edge Trading in the news

  • You are right fundamentals and market sentiment play a huge role in trading.  ANd no one can call bottoms you are so right.

  • I appreciate the comment and I am glad this has value for you. We try to bring some great content here to help traders of all stages.

    Thanks

    Casey

  • thanks for the feedback

  • Thanks for the information I am actually working at making the website better so that would be one way we could do so. Thanks

    Casey

  • G Pawlak79

    Casey, first of all THANK YOU FOR HONESTY ! I live in Europe, I heard a lot of crap comments about Euro Zone. In fact, our situation is a challenge, but it’s not so BAD as US eco. I heard many bad comments about Island and then they are going up and their Financial situation si going better, mainly cause they have a new prime minister which REFUSED another loan from IMF, opened for investors, Google will open there a new server farm… This is very FIRST TIME when I hear TRULY DEEPLY REAL HONEST comment about US. Ufff… medal of honour my friend. In fact, I dont know HOW You allow for so many years that PRIVATE bank prints out dollars and lending them to Gov. Sorry, somebody there is out of mind. It’s spiral and viral of debt in itself.

    Bravo once again !
    One suggestion, I think Your service would be more popular if You could publish FRESH COT weekly analysis reports with recommendations or If You are not allowe by Your law – hidden recommendations 🙂

  • Taskman9

    i bet: This pair should face 1.25-1.24 or less

  • Anonymous

    hahaha! great video casey!…and thanks for the in info. I am new to the market and well you and all the people behind you have been of great help to understand both, technical and fundamental analysis. keep it up my friend…i will continue to follow you.

  • Kanesh

    There’s a rare bullish megaphone formation in the eur:usd 4hr chart.
    Let’s see what happens.
    73kane

  • I need to find out who this guy is? I want to try to understand why but I am with you, the principles don’t change.

  • Aldo (UK)

    With 9 Europian countries getting downgraded and France losing it’s triple ‘A’ rating I think you are asking too much with technical analysis alone. The fundamentals are beginning to weigh down on the euro. And no, I can’t call bottoms or tops and neither can anybody else.

  • Wayne Roberts

    Casey.
    You asked me to comment. Here it is. I liked your Euro comments and the video.
    Cannot comment on the Forex; the only currency trades I have made were futures
    market. The debt/spending/money printing/regulatory situation in this country is
    scary, scary. I heard that we’ ve added 40,000 new laws in the last year. As for
    Europe, Germany seems to  be about the only country over there that ” works.”
                                                                                                               Wayne

  • Chiangaunteng

    a further week on the downside seems more likely, before any up move becomes apparent. it got to reach rock bottom before price changes for the better.

  • maviiri godfrey

    indeed the euro zone stinks.
     

  • John

    Geoff. Interested to know what strategy you employ on the hour charts to capture those euro pops. Can you share it?

  • Michael

    Hilarious video ,so glad I live in Australia . By the way when are you going to change the time from 4 hours to 15 or 30 minutes for the Forex Catapult system. I have had it removed from my Metatrader charts for more than 1 month now and I noticed on a review site it was losing 26% of the account balance .

  • Angel

    Casey, the trading challenge sounds very exciting. Thank you for the invitation. I will give it some serious thought.

  • philby

    Re: http://www.zerohedge.com/news/feds-balance-sheet-unwind-about-crash-market-again
    Of Course the ‘This happened last time so it’ll happen again soon’ always comes with a Big MAYBE. Like announcing Operation Twist (Pretty similar to a QE3) ought to devalue the USD – like it did last time QE was announced. Perhaps the Auction will go well, because the Trading Public at large doesn’t really expect it to. As seems to be a similarly repeated pattern.

  • Kristina Martinsson

    Wrote earlier to friend about eu, government always wins,right trend about no bother
    About weak currency

    Kristina

  • Pjakobson

    Hey Paul Krugman says it is wrongheaded to look at the national debt like a family with a mortgage.  He says (a nobel laureate economist) that we need to spend more, More, MORE.  Can you believe those moron?

  • mikhailmikhail

    i agree with your “read”.As always, timing n entry level n how Italy pans out. Tq for sharing.

  • Frank Lobach

    Thanks Casey,great , simple way to show it like it is to people who may get snowed by the big picture and the “spin” put out by the people running the show in to the ground.
    Hope you can get the “Catapult” fine tuned soon,as it seems to have great potential,but loses a lot of profit instead of locking it in with a moving stop loss?The “Asia Mirror”,so far, is very disappointing to me,hope it improves significantly soon too?
    cheers, Frank Lobach

  • philby

    http://www.zerohedge.com/news/feds-balance-sheet-unwind-about-crash-market-again
    Thought this a good one, think they’re trying to distract ‘The Market’ from a looming Auction of AIG Toxic Debt by the NY Fed. Maiden Vale II. Banks were offering considerably Lower Prices than the going market rate for the dodgy crap they foisted onto the Fed after the Housing Collapse, receiving ‘Bailouts’ for. Seems any Investors willing to touch it want to Hedge it to death. Maybe the reason for the US ‘Ramp Up’ & the media Crucifixion of the EuroZone for it’s ‘debt crisis’

  • Angel, I wish you the best as well. IF you want to really get a challenge you should try our trading challenge http://winnersedgetrading.com/forex-trading-contest

  • Brian,

    Thanks for your support on my blog, I really do appreciate it and I plan on coming through for you in a big way! Rock on.

  • Geoff, I am sorry my articles are boring I will try to make them more exciting in the future. I always watch the big time frames so I have an idea of when I might run into some trouble.

  • philby

    HaHa! I like the Vid, puts things in perspective. Yeah think they might do the Switcheroo before Long, they’ve been on about Downgrades for months, it seems, usually After they happen is a good time to buy – At least Europe plans to cut back it’s Spending significantly.

  • Angel

    I think that you are partially correct. We have a bigger debt problem here at home but we are willing to act fast to try and tame the flames. Unlike Europe where one-size economic stimulus does not fit all. Don’t forget Bond yields. Italy is the world’s third biggest Bond market and the yields are rapidly falling. Bad omen for the Euro?  I strongly believe that the Euro is headed to the mid 1.2500 by the end of next week. The downgrades came  on a Friday before a long weekend when many traders were off on a short vacation. I will wait for a bounce to the mid 1.2700s and sell off targeting 1.2550. Good luck.

  • Geoff

    I trade the one hour chart. Whatever you are talking about is boring. On Thursday/Friday the EUR/USD moved up about 157 pips in total then reversed and dropped over 200 pips for a grand total of about 370 pips. That to me is worth getting excited about. What do you do- sit around for two or three weeks wait around for the market to move according to your strategy.

  • Brian

    As always, great article and great content Casey!  By the way, I LOVED the “Debt Limit” video!!