On February 3 and 4, the EUR/USD fell hard, giving the U.S. dollar a 300-point (or pips) advantage.
The mainstream forex analysts blamed the euro weakness on the fact that "European Central Bank President Jean-Claude Trichet was unable to allay festering concerns over Greek sovereign debt, which investors worry could infect other euro-zone economies." (The Wall Street Journal)
But could you have seen this EUR/USD decline coming before Mr. Trichet made his statement? Yes.
On the evening of Wednesday, February 3, Elliott Wave International's intensive Currency Specialty Service posted this intraday forecast:
EURUSD (Intraday)
Posted On: Feb 3 2010 6:30PM ET / Feb 3 2010 11:30PM GMT
Last Price: 1.3894
[Lower] After a relatively shallow recovery to 1.4027, prices are again declining impulsively. This raises the possibility that a big third wave down is just getting started. Therefore, this is a "sell the rallies" market for now.
The subsequent drop to near $1.3730 speaks for itself.
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