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Category: Currencies
Video (Forex): War Of Words - A Telling Sign Of Reversal
When market psychology gets too one-sided, it's often a sign of an impending reversal.

By Vadim Pokhlebkin Published: Mon, 24 Mar 2008 18:15:00 ET

In early March, arguments over the weakening U.S. dollar got quite heated. Calls on the U.S. Federal Reserve to "do more" to support the dollar and forecasts for the euro/dollar exchange rate of $1.60 or higher were not uncommon.

Soon after – seemingly despite all odds – the USD reversed and started pushing higher against the EUR and other major currencies. Why?

Because collective psychological environment is crucial for the trend in forex markets. Watch Jim Martens, EWI's Senior Currency Strategist, explain this concept in this 4-minute video that he released to his Currency Specialty Service subscribers on March 5.
 

Note: You need a free Club EWI Membership to watch this video.
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Tags: Federal Reserve, euro/dollar, forex, currency
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The Elliott Wave Principle is a detailed description of how financial markets behave. The description reveals that mass psychology swings from pessimism to optimism and back in a natural sequence, creating specific Elliott wave patterns in price movements. Each pattern has implications regarding the position of the market within its overall progression, past, present and future. The purpose of Elliott Wave International’s market-oriented publications is to outline the progress of markets in terms of the Wave Principle and to educate interested parties in the successful application of the Wave Principle. While a course of conduct regarding investments can be formulated from such application of the Wave Principle, at no time will Elliott Wave International make specific recommendations for any specific person, and at no time may a reader, caller or viewer be justified in inferring that any such advice is intended. Investing carries risk of losses, and trading futures or options is especially risky because these instruments are highly leveraged, and traders can lose more than their initial margin funds. Information provided by Elliott Wave International is expressed in good faith, but it is not guaranteed. The market service that never makes mistakes does not exist. Long-term success trading or investing in the markets demands recognition of the fact that error and uncertainty are part of any effort to assess future probabilities. Please ask your broker or your advisor to explain all risks to you before making any trading and investing decisions.