Euro is in big trouble or… ?

As I wrote before there are no buyers on eur/usd. Similar situation is with oil and gold. For me it looks like dollar got back trust. Now every good news from US will be probably a fuel for bulls on dollar, and I think that every bad news will be ignored. Euro with all stagnation in eurozone and its problems is no alternative for dollar.

When we check long term charts, we have confirmation of that. Support at 1.26 did not hold and we have a short breakout. There is some potential support area at 1.22 (blue rectangle), weekly eur/usd:

weekly-eur-usd-with-supports

On monthly chart we can see better that there are support lines at 1.16, 1.18 and 1.20. If this does not hold, we may go back to the year 2000-2001 on eur/usd, but this is very long term view. It is still forex and despite downtrend there may be some strong correction up which will clear some profits. As always… Here is monthly chart of eur/usd with supports:

monthly-eur-usd-with-supports

One more thing about average. Some traders noticed that now on monthly chart eur/usd broke below 200 expotential moving average, which is correct:

monthly-eurusd-200ema

But history says that 200 simple moving average worked better as support resitance. eur/usd is still above 200 sma, which now is around 1.22 level:

monthly-eurusd-200-sma

It looks like for now bulls are away, but they may try to come back around those important supports.

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