Why We Bet on the Euro to Rally This Week

Extended weakness in the dollar typically translates into gains for the common currency

Jul 21, 2017 at 10:53 AM
facebook twitter linkedin

The post-election rally in share prices also embraced the U.S. dollar, but the proverbial bell rang on Jan. 3, 2017 as the dollar put in its rally peak and promptly embarked upon an unambiguous slide that culminated on Friday, July 14 with a close (by the futures on the U.S. Dollar Index) below the key 95 level. And as shown on the accompanying chart of Guggenheim CurrencyShares Euro Trust (FXE), dollar weakness over extended periods is almost always accompanied by strength in the euro currency.

Note in particular the preponderance of purple readings above 70 on the "RMI 20" panel -- which represents FXE's 20-day Relative Momentum Index, and flashes bullish signals above the 70 mark. We expect FXE's rally to continue through July options expiration, fueled by the dollar breakdown and by a successful re-test by FXE late last week at the critical $110 level.

fxe daily 0715

Subscribers to Schaeffer's Expiration Week Countdown service received this FXE commentary on Sunday night, along with a detailed options trade recommendation -- including complete entry and exit parameters -- straight from Bernie's trading desk. Learn more about why Expiration Week Countdown is one of our most popular options trading services.

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners