I was intrigued to look at this Slope post from nearly five years ago which stated:
Let’s notice that a downside violation of 1.2330 completes a massive 4-year top pattern that could “unhinge” the EUR altogether and send it into a vertical tailspin towards 1.1640/50 on the way to parity with the USD — a move that certainly will get the attention of the ECB and the Fed, which vowed to defend the integrity of the EC last weekend.
It may have seemed nuts at the time, but with this enormous symmetric triangle that has been broken (and the Euro plunging anew this morning), we could well be at parity this year!
Further to my recent posts here and here, the EUR/USD Forex pair has reached a potential (double Fibonacci) support level between 1.1205 and 1.13, as shown on the following Weekly chart. A possible bounce is in store for the Euro.
Failure to begin stabilizing at this level and reclaim the major resistance level between 1.19 and 1.2125 (seen pre- and post-2007/08 financial crisis) could send the Euro plunging down to the 2000 lows of 0.8227. I can’t imgine that’s what Mr. Draghi has in mind with his ECB QE policy announcment earlier today…although stranger things have happened.
USD hit major price and double-Fibonacci resistance at 93.00, as shown on the following Weekly chart. A break and hold above that level could prove “interesting” for other world currencies (Euro, Canadian $, Swiss Franc, Japanese Yen, etc.)…(at the time of writing this post, the Canadian $ is -1.83 at 80.77).
Volatility in currencies has certainly been the norm, of late.
A number of market commenters in these days have been saying that the decision of the Swiss National Bank to un-peg the Swiss Franc by its artificially constrained change rate with the EUR, USD, etc. was a Black Swan.
In my post of December 16, 2014, I stated:
” It may be that we will see larger volatility ensue in currencies, before they play out to any great extent (or near-term trends become very clear) in world indices.”
The RSI, MACD and Stochastics indicators on the following Daily ratio chart below of the SPX vs Swiss Franc ($SPX:$XSF) were forecasting a weakening of the SPX compared to the XSF from last November.