Hello 2010 and hello to our friends in the Money Tigers Group.

Glad to greet all of our readers again on this new side of the yearly calendar.

We start this year with a trend that promises to last for several months minimum.

I’m talking about the EUR/USD forex pair.

The Euro is definitely on our trend line radar and the direction is down.

The Euro is acting weaker than other currencies at present and may be the leader of the pack going out of the gate early.

This is particularly important if you are implementing a cash equivalent strategy.

In short, that strategy encourages cash ownership of commodities or having the ability to completely fund the total valuation of a futures contract.

In the case of currencies, this approach would consist of parking cash itself in a strong currency account so that one can take advantage of interest paid in a strong, rising currency and benefit from increased valuation of the cash deposit as well.

A weakening Euro means that Euros should be converted into a stronger currency.

At present, those currencies with the strongest performance for growth of value are the US DOLLAR and possibly the AUSTRALIAN DOLLAR.

THE BRITISH POUND Vs. JAPANESE YEN:

The British Pound has lost a little of it’s downward momentum, but is still solidly locked into a down trend.

It would take some mighty upward action capable of breaching the red arrow trend line on the chart on the left before this strong decline could end and reverse directions.

A weakening Euro will certainly not help the British Pound. Quite the opposite would be the guess in fact.

We’ll comment on some alternative hard assets besides Gold in the next posting.

All the best, – George

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