CurrencyShares Euro Trust

Another eurozone ETF that's getting plenty of Twitter attention this morning is the CurrencyShares Euro Trust ( FXE), a fund that gives investors exposure to the movement of the euro. Like EWZ, FXE isn't looking particularly bullish right now - but there's a more predictable move at play in this stock.

FXE is currently forming a descending triangle pattern, with horizontal support at $129.50 and downtrending resistance acting as a sort of ceiling for shares. Essentially, as FXE bounces in between those two technical price levels, it's getting squeezed closer and closer to a breakdown below that support level at $129.50. When that happens, traders have a signal to bet against this fund.

The next-lowest support level in FXE is $126, a price that acted as a floor for units back at the start of the year. That price provides a good preliminary target when and if $129.50 gets broken to the downside. If you do decide to take this trade, I'd recommend keeping a protective stop just above the 50-day moving average.

To see these plays in action, check out the Technical Setups for the Week portfolio at Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.

RELATED LINKS:



Follow Stockpickr on Twitter and become a fan on Facebook.
At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on MSNBC.com.

If you liked this article you might like

Watch This Retail CEO Quickly Explain How to Survive Hurricane Amazon

Michael Kors Stock Has Nearly 50% Upside Even With Amazon Crushing Everyone

Coach CEO Perfectly Explains What Must Be Done to Survive Retail Apocalypse

Coach Has More On Its Plate Than Just Fashion Week Craziness

Coach Flaunts Hot New Look for Fashion Week