Euro and Dollar Are Focused on Draghi not Bernanke
- Posted by Greg Harmon
- on August 31st, 2012
Heading into the Bernanke Speech in Jackson Hole today the US Dollar Index is poised to breakdown lower and the Euro is set up for an upside break out. What could the Bernanke say that would set up these two charts they way they are? Nothing. This is all about Europe. The Euro chart below is ready to pop over 1.2555 with a target of 1.2770. This would put it over the ‘C’ and make a higher high. Very bullish. And the US Dollar Index is consolidating in a bear flag at 81.24 with
a Measured Move lower to 79.90, back into the consolidation zone it broke out of to begin the move higher. A weakening Dollar and strengthening Euro do not foretell of Bernanke QE3, or do they? All along the long term macro picture has been that QE will raise asset prices by raising inflation, debasing the currency, it just has not been happening yet. Perhaps the Dollar Index is focusing on the Bernank with the assumption that Draghi will fix the Euro. I guess we will have to listen to Ben AND see what Super Mario has up his sleeve after all.
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Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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