Euro lower in a constitutional crisis for Spain
In a constitutional crisis for Spain, amongst violent scenes where over 800 people have been injured by police firing rubber bullets and battering civilians in a historic event that has taken place this weekend, the head of Catalan regional government says the referendum opens doors to a unilateral declaration of independence by Catalan parliament.
"Catalan citizens have won the right to an independent state," said the head of Catalan regional government.
The euro has gapped lower just below the 1.18 handle in early doors illiquid Asia.
However, analysts at Brown Brothers Harriman suggested that there is scope for additional near-term gains, perhaps spurred by the other weekend press, much of which seems critical of the White Houses tax proposals for being sops for the wealthy and corporations.
"The euro can recover into the $1.1860-$1.1890 area without jeopardizing out the negativity evident in the weekly bar charts, and signified by the end of the six-month advancing streak in September," argued analysts at Brown Brothers Harriman.
Technically, the analysts have noted the potential head and shoulders topping pattern, which projects toward $1.16, which is around the 20-week moving average. "The mid-August lows were set a bit higher near $1.1660. The weekly Slow Stochastics have turned down, and the MACDs appear poised to cross lower. The weekly RSI is showing a bearish divergence by not confirming the recent highs in the euro," they added.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
