The Dollar-Euro Trade Shows Opportunities

The relationship between the U.S. dollar and the euro is normally negatively correlated, their relative performance a result of interest rate differentials, economic and political stability and currency speculation. The dollar has been strengthening recently while the euro is in some technical trouble, and both conditions offer trading opportunities. 

The weekly chart of the U.S. Dollar Index (USD) shows it moving around a key set of Fibonacci retracement levels measured off the 2010 high and the 2011 low. Currently, the 50% level is acting as resistance, and the 10-week moving average is crossing above the 40-week average. The Bollinger bandwidth indicator at the bottom of the chart is overlaid with an average true range reading, and both suggest tight range compression and the potential for a volatile move....249 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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