Forex Broker: What is the Next Trend of the Euro?


Active Trader
Jun 28, 2010

Forex Broker---- Adam Hewison, president of, made a technical analysis of EUR/USD, and said that current forex rate was experiencing drastic changes where the euro was sold, along with short covering. Therefore, the euro would have much more potential to rise.
According to Andy, the euro once reversed substantially in 2008, which means that the euro reversion may high record high. Although the euro is overvalued, the real forex rate may be near parity, yet it would not slump to the bottom overnight.
So what’s next? Marc Chandler, forex analyst from BBH wrote last week that if there would be something that follows EUR/USD trend, it would be the 2-year swap rates of the US and Germany. The last low was on November 23rd, 2009 when Germany was 62 basis points higher. Two days later, the euro hit the high of 2009. After that, on May 27th, 2010, US swap rate was 33 basis rates higher, and the euro touched 4-year low after two weeks.
The forex market has redrawn interests on whether Germany will quit euro-zone. Investors began to short sell USD swaps and buy the euro. At present the swap rate has come back to the level where Germany is 20 basis points higher.
If this trend continues, the euro will rise further. As pointed out by Marc, “when some district should adapt accelerating tools, there is usually time delays.”
On the other side, Hewison also made technical research with Fibonacci tools, and identified several major resistances to the euro. He stated: “the euro has been rising strongly from 1.1900, which will, however, end soon.”He predicted that EUR/US would eventually be parity, but the process would by no means be easy.----Forex Broker: Ikonfx

By Amanda