The euro has been struggling in a range for some time. From the daily chart below of the Currency Shares Euro Trust, (FXE), the price action has been consolidating in a ‘W’ like pattern, making an Ascending Triangle. This pattern targets a move equal to the biggest part of the triangle on a breakout.
In this particular case it's a $5 move. And with the price holding near the top of the triangle that would target a move to 141.60 on a break higher. The other indicators, RSI and MACD support this.
But what is interesting about this chart is that it did break out, for just a minute, early on Monday, only to be dropped later. Is this a sign that buy orders were in from Friday that pushed it higher? If the Ukraine situation settles does, would this mean a break could happen Wednesday? Or by the rate decision later in the week? The euro does seem primed.
But 141.60 may not be the end of it. A check of the weekly chart shows that the short term break would also trigger a longer term Cup and Handle that targets a move to 152.50. Does that make it more intriguing?
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