What do you think is going to happen to the EURO vs the U.S. Dollar in the next month? Today on our 1 pm update we will be looking into the trend of the EURO and point out some very interesting traits about the Forex markets.
It's that time of year again when everyone who is considered an "expert" comes out of their ivory towers and makes their annual market predictions for the New Year.
It's time to kiss those predictions goodbye.
I can honestly say that I wish I had a crystal ball like these other forecasters, but that's not quite how the markets work. You see, markets don't give a "Rats A**" about what forecasters say or what predictions economists make. The market is the only true voice out there.
Think about that for a moment. How many predictions do you remember that were even close to being spot on a year in advance? I remember several forecasts for 2010 and most of them were far from accurate.
Does it make any sense to trade on a year-end forecast, not knowing what can happen in this crazy world we live in? It doesn't make any sense to me or to other professional traders who never trade based on year-end predictions.
So let's get back to reality and take a look back on 2010 to see what the big trends are showing for 2011.
Late last week we produced a video on the euro (which was posted on our blog on Monday), making a case that the currency was very close, if not at its highs. Since then, we have had two significant events fall into place which made the dollar skyrocket against the euro.
After dipping just below the 1.20 level, the euro had a brief rally that pushed this currency back up to the 1.24/1.25 area. This corrective rally did not change the longer-term outlook for this market.