Where is EUR/USD Headed, Broke Support (Dennis Gartman, John Taylor and Chart), 1.30 and 1.25 Look Like First Support Levels, 1.35 New Ceiling Resistance

EUR/USD has been in play on this blog since February when it was at 1.39. I said a few days ago to watch the critical 1.349 support level on EUR/USD and since then it broke through that floor and is now trading at 1.33. Here's what is going on:
"European Union leaders will hold what is likely to be a tense and difficult summit on Thursday, divided over how to help heavily indebted Greece and struggling to maintain confidence in the euro.

Diplomatic efforts on the eve of the two-day summit failed to bridge differences over whether to offer a safety net to Greece, helping push the euro down to a 10-month low after Portugal suffered a debt down downgrade."
(read full Reuters article at CNBC.com)

So it's obviously a big mess and hedge funds are trying to make dough off this.  On Fast Money Dennis Gartman of The Gartman Letter said he was short the Euro and said it could hit 1.25, 1.20 or 1.15 (how about 0.75). He mentioned that the 100 day moving average crossed below the 200 day moving average which is a selling indicator.  Also if you're interested Gary Shilling thinks the Euro will hit parity with the Dollar.

John Taylor who runs FX Concepts, the largest currency hedge fund with $9 billion under management, was on Bloomberg today and said the Euro could hit 1.20 by August. He also likes Asia [Sell Euro, Purchase Asia on Recovery, FX Concepts’ Taylor Says - Business Week].  Hat tip zero hedge blog.

Here is the EUR/USD chart and 1.30-1.25 look like the closest support levels.  The two blue lines are the 100/200 day moving averages Gartman was talking about. 1.35 is now ceiling resistance to break and the downtrend is intact for now. If the Fed bails out all of Europe and EUR/USD tests 1.35 resistance tomorrow, it would turn into a a different story. At some point shorts will cover in size (hopefully not at .50).

Chart courtesy of FreeStockCharts.com

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