Any chance at all for P A R I T Y. Not within a day. Expiration games carry only so far and December 19th went without a spike for parity, instead we saw a pull-back. But there is renewed talk in the media calling for parity and the pound joining the ECU. It will take some time, but parity is sure in the cards now.
Is the Euro really that strong? Isn't the EU in as big a mess as the US. Obviously not, at least if you look at the exchange rate. My article on November 25th was prophetic. But I did not expect such stellar returns. I'm just glad I followed my own advice at least that much, that I converted my account to Euro, when the Euro broke 1.31. I did not hold additional futures, but at least I did not lose on the US-Dollar depreciation.
But when will it stop?
Markets can remain irrational a lot longer than your account can survive. Still there is strong resistance 200 pips ahead from that top made in the down move. And I expect the Euro to stop and retrace from there down to at least 1.40, which would form a very clear inverse Head and Shoulder pattern on the daily and the weekly chart, something not seen very often.
At the same time the Euro/GBP exchange rate is on the move. London isn't at all unhappy about the weak pound to help it's ailing economy. Add to that, that it might economically be in the interest of the UK to join the ECU and a move to parity wouldn't be such a bad thing to convince our British neighbors to join the ECU.
Just 570 pips to go.