FXE

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The EuroCurrency ETF is deeply oversold in a new, solid downtrend. The way to structure trades in this market is to wait for a rally back toward the low-risk RESISTANCE AREA marked on the chart from from 140-145. Enter shorts starting at 138, 138.50, 139, 139.50 and use a 143 stop initially. Once 136 is violated then reduce stops to 141. The fundamental backdrop of the European Banking System tells of dramatic over-leverage and inadequate equity capital underpinning its loans and that suggests that it is wise to move funds out of the currency of the region. Look for a continued, long term downtrend in the Euro and sell short the FXE when risk:reward is appropriate.