Whilst I doubt it would be considered unique or Earth-shattering to express a bearish view of the Europe there are some notable signs that are visible in the market this morning – particularly on the hourly chart. When you look at recent volatility levels you can see that Euro vol has jumped pretty significantly – this is particularly notable on the chart below when looking at the 50 period volatility bands.
You can see that over the majority of the chart that the rate has been skating lower along the -1.25SD band of the 50 hour moving average. At the current retest of this level though the rate is also meeting resistance from the -2.25 SD level of the 200 hour moving average as well. Whilst this is quite a short-term setup to be watching I think that this level may be a very good indicator for all Euro traders to keep an eye on because a break higher from this level may give an early warning of short-term trend reversal.
For traders on the short side though waiting to see if this level is respected and then entering a short EURUSD trade with a stop above the 2 volatility bands that I discussed may give a good risk reward trade.