EUR/USD view for week NOV/13/2007

I. Important news from the week:

1. EUR/USD hit 1.47.50, Gold passes 845 USD, CAD now "costs" 1.10 USD, GBP/USD = 2.10.

2. JPY rising against everything, but mostly against GBP and EUR.

3. "If USA want to debase their currency, we will respond" - French president Sarkozy said.

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II. As I wrote before:

FED blew it!!! They totally destroyed the dollar in long term. I think they will inflate now, and stock market will go higher and higher, but only in nominal terms.

GOT GOLD :-)

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III. The parallel uptrend (old wedge):

EUR/USD 4 days chart:
What we have here? Price go to upper channel line, even broke it for 1-2 hours, but then fall inside the channel.

Note (not shown) EUR is overbought on both weekly and monthly chart.

EUR/USD 1 days chart:
Here we have the channel I show last week. Price remained inside the channel ALL the time, even when hit 1.37.50. Now EUR need to go down at least to 1.46. If this level is broken, next target is brown line - 1.41

EUR/USD 4 hours chart:
Here is "speculative" chart. Unfortunately not so speculative right now. Target is 1.46. There are also a bearish wedge (not shown), with target down to about 1.45-1.42 - never checked exact target, but wedge is there.

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IV. GBP/JPY H&S:

GBP/JPY 1 week chart:
I usually do not trade GBP, even it is probably better than EUR.
However, now we see something interesting here:
Here we have huge H&S formation. Target is under 200.
In case you play this, note you will pay huge ammount of overnight interest every day to your broker.
Note GBP/JPY and EUR/JPY open with a gap, I will probably trade it.

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V. Summary:

I can say absolutely the same as previous week:

Generally USD will rise now, EUR to fall, but play carefully.

Remember EUR is just a worthless paper as the USD is. Eurozone has own problems too. The only reason EUR go up against the USD is because Eurozone and ECB do not inflate as much as FED. Or may be they do now. Who knows. The inflation we see now, is actually from money supply increased 6 mo ago. So we do not know if ECB printing money or not.

>>> I will add that French president Sarkozy said "If USA want to debase their currency, we will respond".
We still not know what this response will be, but is easy to imagine what he means.
Note I respect Sarkozy for what he done for Bulgarian doctors in Lybia, but we will see.

There is only one real currency and is called GOLD. As you can see, gold rising against all currencies, not only against the USD. This may mean only one thing - inflation rising. Actually some people believes gold is bubble, but this is wrong opinion (will explain why I thing that some other time).

Happy week and trade!!!