EURUSD

The gray box is the weekly target zone.

Dollar Weakness

From Larry Levin

Tuesday's Sell Off

The Holiday-shortened week started off with Tuesday’s drop.  The sell-off followed on the heels of Monday’s Globex-only session. The Dow Jones closed down 1.44%, S&P 500 closed down 2.05%, and the Nasdaq was slammed 2.74%.  
 
On the flip side oil was up nearly 10% since its last regular session.  Gold and silver were also up substantially.
 
What was rather surprising, however, was the old “flight to quality” standby: the US dollar.  It never caught a bid!  With so much global uncertainty and a strong sell-off in equities, there is usually a strong “flight to quality” bid in the US dollar.  I checked the currencies several times Tuesday and was surprised each time that it was so slow.  
 
The CIO of Pimco was also surprised and said on Bloomberg today, “It is a warning shot to America that we cannot simply assume flight to quality, flight to safety. That people are starting to worry about the fiscal situation in the U.S., worrying about the level of debt and what they're hearing about states and municipalities. I would take this as a warning shot that we cannot assume that we will maintain the standing of the reserve currency as we have in the past.”
 
The violence in Libya continues to escalate with the dictator, Qaddafi, saying it could become a civil war, while threatening to hunt down all protestors and kill them in their homes if they do not stop.  Moreover, he declared Force Majeure on the 1.5-million barrels of light sweet crude oil Libya exports daily and threatened to blow up its oil infrastructure…a-la Saddam Hussein. 
 
Although the protests have spread to Bahrain and have really escalated, which is bad, the oil situation would only become truly frightening if the problems led to a Saudi regime change.  Until then, it’s possible that this oil spike and the equity swoon are nearly over.

Oil $200/barrel

What these videos and see if you agree. If this happens as outlined in the videos, will it mean the end of the dollar by the end of 2012?
Part 1
Part 2
Part 3
Part 4
Part 5

Pause at point A is 88.6% PWMM projected from weekly low. Watch for point B at the upper channel line and the 100% PWMM projected from the weekly low.

EURUSD hit daily low at 100% DMM (gray box) projected from current days high prior to the continued trend long. This level is also confluence with the previous week's close.

EURUSD move down to 50% DMM projected from high and retraces to 61.8% DMM from new low.

EU at Weekly Control MM

EU is at the weekly MM that hasn't been filled. Levels shown in pic.

EU Weekly Target

EU weekly target to look for within current trend.

EU hits 100 DMM

EU hits daily 100% MM projected from the current day's high. This is also confluence with the 61.8 daily fib pivot projected from the open. Larger targets are also shown at the 100 fib pivot. Eu has now hit the weekly 50% and daily 100% MMs. The current day has also fallen within the weekly 38.2 MM projected from today's high. Very high probability that EU has extended to its maximum for todays range.

EU hits 50% WMM

EU hits the weekly 50% MM

EU Setup Short

Zone for trend continuation.

EU hits Monthly Control 61.8 MM

EU today extended its bearish run to hit the Monthly Control 61.8% measured move for Nov.

EU hits Weekly 100% MM

Euro hits 100% of the previous weeks measured move. Shown in the gray box.

EU Monthly Measured Move Realized

The Oct 100% MM from Nov high to today's low.

Another day the fib pivots have worked out in picture perfect form.
In this we see all during Asian session that the previous days pivot held as Res as FibPivot level 27.2 PDMM acted as Support. During London with a break of 27.2, price goes straight to 50 PDMM. It finds the 50 as Support and the 38.2 as Res. A break of 50 and we quickly ran to the 100 PDMM.

Another day the fib pivots are well respected.

At 61.8 PMMM projected from CLOM.

Follow to the post showing the high hitting the 100 PWMM to the pip. Now a rejection of that level and new daily fib pivots applied and we have just hit 61.8 PDMM projected from the PDC.

We have just hit the 100 PWMM projected from CLOW. This is on the 6th trading day of the month. Will these be a short reversal level?

This pic shows an inner trading day for Mon and Tues, Tues high reached the 100 PDMM from the previous day. This is often common when inner trading days happen. This VIDEO walks you through it.