But if history is any guide, this rally may be in the midst of a “turn” lower! Looking at the chart below, you can see blue-shaded triangle patterns that both resolved to the downside (one in the 1990’s and another in the 2000’s). In both cases, the Euro came back to “kiss” the underside resistance of the triangle at points (1) and (2).
In the 1990’s, that kiss occurred just before another turn sharply lower. Could that be occurring again? Will point (3) mark a moment of historical deja vu?
One concern is that the sharp uptrend line (marked in red) off the January 2017 lows has been broken. This should see more selling to come… but how much?
Will it fall sharply for a couple years… or is it different this time?
Euro Currency “Weekly” Chart
The Guggenheim CurrencyShares Euro Trust (FXE) was unchanged in premarket trading Friday. Year-to-date, FXE has declined -0.39%, versus a -1.59% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of Kimble Charting Solutions.