Euro, A Primary Degree, Diagonal Perspective.




Up into 2008, gold and the Euro were best buddies, as the US dollar imploded. Now if the Euro is going to melt down, but gold is supposed to go up, then this would be a blatant Euro divergence from gold. If the Euro still makes a steep plunge but starts to find a base, then we could see a strong Euro rally that will impress us. Of course the USD would have to drop like a rock at the same time. With a spike forming, it would not surprise me that it can turn sooner than we think. 

Looking at the Euro commercial positions, they added about 23,000 contracts, to an already heavy net long position, this is very bullish for the Euro and also means downside would have far more resistance than we may think. Of course the merry band of speculators, have increased their short positions as well. This smells like a Euro bear trap, and until that all reverses, the odds that we get a Euro rally, starts to increase substantially.


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