EURO Index and why we should to watch during the trading with Euro

Trading on the FX market, monitoring the major currency indices such as the Dollar Index, the Euro Index and the British Pound Index is an inevitable part of the forex analysis of each trader. Let's look at the EURO Index and make a technical comparison with the EUR/USD, which is often considered a benchmark of the euro - a big mistake!

First EURO Index (Main Chart)

The technical value of the index remains in a wide range near the tops reached at the beginning of the year. If we compare to EUR/USD, we will notice that the price is far from the formed range at the top. What's next for the EURO Index from now on? Long-seems more likely, despite the negative CPI data they published earlier. The price of the index is in a zone of very strong support, formed by horizontal support, 23.6% Fibonacci correction of the main trend and close to 200SMA. Indicators also support growth. Sequential counts 9th and puts a down arrow - the probable end of Short impulse. DeMarker points upward from a surplus sales area - positive for the price.

Let's look at EUR/USD

In short Short seems inevitable. Here are the reasons for this. Breakthrough at key level formed by 200SMA, horizontal support zone (already resistance), triggered triangle formation and breakthrough at 23.6% Fibonacci correction of the main trend - the path to 38.2% looks clean.

What is the conclusion? If we follow the EURO Index, traded with the Euro, regardless of which currency it is quite possible to avoid the false breakthroughs, and to find out when a correction should be made, even if nothing else indicates that.

Read more:

• EUR/CHF – Sells seems to be the best trade
• EUR/USD: sentiment and technical analysis
• The breaking point for EUR/USD, the winners from Brexit: European session today (28.08.2018)
• EUR/JPY – Technically and fundamentally, the growth seems more likely
• J. Powell optimist about the US economy, USD stay under pressure