Euro Going To 1.20 By 4th Quarter (FX Concepts John Taylor), EUR/USD Technicals (Chart)

John Taylor of FX Concepts, the biggest currency hedge fund in the world, thinks the trillion dollar European bailout will just delay the fall to 1.20 on EUR/USD.  He thinks it will hit 1.20 in the 4th quarter and potentially lower.  Taylor is a Dollar bull favoring US over European economic growth and I'm sure forward looking US/EU interest rate differentials are part of the equation.  The chart does not look healthy.

It's interesting that the initial EUR/USD spike above 1.3 on the bailout news was sold hard to 1.27.  It could revisit the 1.25196 low from last week and double bottom support from 2008/early 2009 at 1.24/1.25.  If these levels get taken out, it is game over imho.  The Euro will hit 1.17-1.20, making FX Concepts billions on its 100x leveraged EUR/USD short position.  I bet the RSI (relative strength index) breaks below 30 before a confirmed bottom.

For recent posts on EUR/USD and Euro click the links or labels at the bottom.  I've been covering the Euro since the Dollar bottomed after Thanksgiving 2009.  Look back at EUR/USD or Euro Index posts from 12/1/2009-5/1/2010 for a refresher.  Big institutions were loading up on the Dollar before the Euro crisis hit.  See John Taylor on BloombergTV on 3/25/2010 giving his 1.20 call here.

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