The US Dollar continues to be the top performing currency, although the recent financial turmoil has not helped it. While the Euro is falling against the Dollar is up, some would say that the Euro continues to fall against the Dollar. Thus, the Euro continues to decline against the Dollar, and so the Euro continues to have its own set of problems.
For many markets, including the Euro, the US Dollar remains a stable choice for investors. However, the US Dollar also continues to trade away from a higher level, and that is problematic for the Euro. The Euro is trading at nearly a five-year low against the US Dollar, and in many cases is now trading below the levels which are considered as support levels.
For example, the Euro traded at close to the levels which are considered as resistance on Friday, but after the Euro’s weakness, it dropped further and has come back down to support levels. This is what is known as an inverted triangle formation. In this type of resistance and support level, it is known as a Three Ball Spiral.
On this type of triangle, it is very hard to trade in the direction of the support, as it is usually seen at a very high price level. When the Euro declines further and sits just below the support level, it is difficult to buy it at a price level where the sellers have made a profit.
This situation is very negative for the Euro. The fact that a number of countries with weak currencies, like China, India, and Turkey, are all selling the Euro, is a problem for the Euro.
As the Euro loses value against the US Dollar, the Euro is more vulnerable to a weaker dollar against other countries. If the Euro falls further, it will increase the volume of selling against it, and with less demand, the Euro will appreciate.
For many investors, the US Dollar is considered as the best store of value and the safest investment, but for others, the US Dollar has problems, like the Euro. The strength of the US Dollar, and it’s ability to maintain a strong value in the face of economic turmoil, has been a major factor in the growth of the stock market and the continued success of the US economy.
The strength of the US Dollar has been a major contributing factor to the growth of the stock market. The weakening of the Euro against the US Dollar can be considered a minor factor, even though it may be worrying to some investors. Perhaps it will become even worse if the Euro continues to fall further.
The Euro is in a period of weakness, and the majority of the emerging economies are holding back their currency’s strength, to allow the Euro to strengthen. It would seem that the European Central Bank’s policy, which it has been applying over the past several months, has been a net positive for the Euro.
The Euro’s weakness has actually given some stronger currency markets the opportunity to expand, and they have done that. Many emerging markets are now able to create stronger currencies in their own countries, and they have enjoyed a growing trend.
The Euro has also been weakening against the US Dollar, but this is because there are too many investors trying to take advantage of the weak Euro. This has resulted in the Euro losing value, but it is actually making many foreign markets stronger, in order to protect themselves from the greater market movements of the US Dollar.
Thus, if the Euro keeps falling, it will make other markets stronger, but it will be almost impossible for the Euro to go higher. Investors need to take a long term view, and ignore the short term.