SAMT Blog
EUR/USD Parity: A Clear & Present Reality?
05. August 2022, by Ron William
Technical Analysis
EUR/USD is cliff-dropping below the pandemic-era lows, under the all important parity level. Technicals verged on further deterioration once the major rate traded below a major floor at 1.0340, weighed by a twenty-year downtrend (Figure 1). 20 YR Trend Breakdown.jpg)
The move is part of a much larger historical crisis pattern last seen between 1985-2001, which exhibited a two-stage impulsive rise and volatile corrective fall (Figure 2). Both price analogs developed strong uptrends, lasting 91-93 months that were short-circuited by event shocks.
The sustained weekly close beneath 1.0340 made the parity target a clear and present reality. It is noteworthy that EUR/USD parity was already projected several years ago, based on a long-term bear cycle skew (Figure 2 lower chart window).
 Crisis pattern.jpg)
Using more traditional methods such as Point & Figure charting also signals further downside scope into 0.9900 and 0.9700 (Figure 3). Only a viable recovery back above 1.1000 value zone would neutralize this scenario. There is a perfect storm of asymmetric risk, marked by the latest technical breakdown, global growth concerns stemming from China&rsquo...
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