EUR

In July 08, the Euro topped 1.60 and fell to 1.24 in the following months (Nov 08 / March 09). Then in Novemver 09, the Euro went above 1.50 and then fell off to 1.19 in early June 10. Once more the Euro has just bounced off 1.40.

There is a symmetry between 1.60, 1.50 and 1.40 which techincals would call a flag formation. In all three scenarios, there is a background narative of US economic slow down, falling rates and quatitative easing. The Euroland during these ascents to 1.60, 1.50 and 1.40 was considered relatively Ok or coming out of crisis.

The key question now is whether the Euro will climb back above 1.40 or not? If it does, will it touch 1.50? or more? The key ingrediant is lax US monetary policy and as long as this stays, the upward move WILL happen. However, any emerging crisis will immediately benefit the Dollar during this process.

Dollar losses should occur over several months since QE2 cannot be just for one month.
An open ended QE2 will be more damaging to the Dollar than a big band 1 trillion annoucement. However, all indications are that QE2 will be in small monthly steps.

Rather than QE2, I think the US should directly go for trade sactions on select Chinease imports and lobby the EU to follow suit. Minus trade sactions there is no leverage for the US to force Chinese to appreciate their currency. In addition, Obama needs to review NAFTA as he promised before his election.

3840 is the value dat marx the upper band of the tunnel , once has been penetrated last nite

said
there is a lack of capital and an oversupply of liquidity. Only creating added value by production
turns liquidity into capital. More liquidity cannot restart the economy.

jetus
have not u noticed the disconnet between sandp an dtresury gain so i think the disconnect will continue till QE will be decided.

Jetus
chart attachment can't get it working.
Google FVX or Treasury Yield 5 Years plenty of charts decisionpoint yahoo etc.