I guess I have this thing with trendlines. They definitely work well...the hard part is knowing when you have a breakdown or when it is false. The other day, I thought gold had a significant trendline breakdown...even Dennis Gartman said publicly he was going to get rid of his gold. However the daily stochastic does look oversold...so we'll see. Maybe the deflation arguement will keep gold down for a little.
As for the Euro...take a look at this trendline from the EUR/Sterling and see if it has been violated (clicking on the chart gives you a clearer view):
I always wonder...at what point should we use a different pair as confirmation and when we shouldn't. When is it just a big institution taking a position in a trading range...and when is it a true reflection of news? (Elliot Waves suggest neither!) A trendline has to be touched a minimum of three times for it to be a trendline. The more touch and bounces, the stronger the line. The one above touched six times before being breached.
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