Euro Forex Pro Weekly 2010-04-28

[Sive Morten]

Hi Sive
What is your opinion about what would happen if Greece really destroy the EUR currency ? Best regards

Hi Dori, very nice avatar by the way.

Well, this is a huge theme to discuss, but I'll try to answer somehow.
I think, that in the nearest future Euro will stay. If you check some my previous researches then you can find in fundamental part one of them the reasons, why it is so unwelcomed to separate EU. If it will break on independent countries - this will be great political and economical risk. Just emagine that 60-70% of Germany's export is for EU contries. It will strike on strong countries also. Different custodian fees will appear again etc. This will be a collapse.
From the potician point of view there is also a great risk. Imagine, that Greece should find fiscal aid somehow without EU help as Portugal, Ireland, Spain and Eastern Europe. This can lead to different separate contracts with third countries such as US, Russia, China in different spheres, that can be not welcomed for Europe in general.
So, I think, that this is an extreme way, and for now it is too early to talk about it.

what would happen to the pair eurusd ? suddenly disappear?
Or it would happen gradually until the pair rate becomes 0.0001 ?

If eurusd disappears, who would take its place ? GPBUSD ? or Deutsch mark/USD ? I mean in terms of strengh and liquidity

As a result each country will return to it's national currency. But how it can be - it's impossible to say now. Surely it will be gradually excluding countries from euro economy - almost as a gradual including just before. Just remember there was an ECU previously (Euro Currency unit).
There will not be fall to 0.0001 surely. I think it will be just as with DM.
But again these events for now have a very small probability. Although they have it still.

Hope it helps,
Sive.

 

[Sive Morten]

Friday update

Ok, let's look what we can expect today.
This is an 60-min chart of EUR/USD,
red line is a MACD Predictor (when prices are below it - trend is bearish, above - bullish), green line - Weekly Pivot support1, Blue line - Weekly Pivot.

First of all - look, prices move below MACD Predictor, and formally trend is bearish now. But, price move does not support that issue - they do not move lower. So, we have a Dynamic Pressure here, and can expect upmove.

At the same time, there are much stops here - as above the market, when people are selling on a changing trend to bearsih and below - people are buying for break through and had bought on retracement yesterday. So,
before up move I expect, that these stops will be clear out, i.e. wash& Rinse of support level. Also today pretty much macro data - GDP, Mich sent, PMI, we should expect a solid volatility today,ok?

What will I be watching for?

First, - W&R of lows. If i'll see it - I will be a very short-term buyer somwhere around Fib support and weekly pivot support 1.3218. The target - is 1.3310 level. In this case - the stops that are above the market will be cleared out. Possible, market can reach an OP and weekly Pivot at 1.3360 area. But, this is a probability game, and we should take a objective points.

If you will want to stay in game - that's fine, but tight your stops, possibly even to b/e.

If market will clear upper stops first - I will be aside for today and look for opportunity to enter short on next week.
Sive.

 

[Sentinel]

Thanks for the great analysis once again Sive. I was in US for an exhibition and stuck there almost for two weeks due to the volcanic erruption. Back yesterday and glad to be able to track your analsis once again.

 

[Sive Morten]

Hi, Sentinel,
And I've thought, why do I not hear from you anything for a long time?
Nice that you've come back.

 

[Lynley]

Euro

Hi

Brilliant analysis. Is there really a possibility that the euro could be scrapped?

 

[Sive Morten]

Is there really a possibility that the euro could be scrapped?

Hi, Lynley

As I said, it's too early to talk about this and there are no meaningful signs for that yet, not even Greece debt restructuring has started yet.

I think that X point of possible great changes in EU will be when Spain, Italy and Portugal will have to payoff debts and interest on it.

Disadvatages of EU destruction are overvalued advantages for Germany, for example. So, I think that EU will make everything that possible to hold the Union.

But, If it will start to come true - we'll see it.

 

[Dori]

Hi Sive,

Thank you for the analysis.

By the away, thanks for the compliments to my avatar. I don't know if you are aware of it but it is a brazilian soccer team badge. the team is Corinthians and it is based in São Paulo city. I think I don't have to mention it but it is the team I rule for )

Best regards

 

[Sive Morten]

Wow, Dori.
Of cause, I know Corinthians, Gremio and other brazilian clubs, although I do not follow the brazilian championship very close.
I like soccer much, but more familiar with european clubs and competitions. Barclay's English Premier League is my favorite one.