Tuesday, September 15, 2009
EUR/USD Forming Major Top; September 15, 2009
The EUR/USD appears to be forming a major top as I stated in a previous blog post. If you look at the above daily charts of the EUR/USD and the GBP/USD you see a major bearish divergence showing here. As the EUR/USD has surged to new highs the past week, the GBP/USD is severely lagging. If this divergence holds and a big selloff occurs, it will solidify the position that the EUR/USD has formed a major top and will sell off thousands of pips. It appears the EUR/USD is mirroring the stock market so the pair should top and reverse in line with the stock market. The 1.4700-1.4800 area looks like a good topping point, but it's just a guess at this point. I'm waiting for a strong reversal day and a five wave decline to get my attention.
CHARTS SUPPLIED BY FXCM.COM