Calendar Year Highs and Lows in the Euro

January 5, 2010

The calendar year highs and lows of the euro against the dollar tend to occur not far from the turn of the year.  This most important of all dollar pairs began its twelfth year of trading on January 4.  Of the 22 highs and lows in the previous 11 years, ten were set in the fourth calendar quarter, and nine occurred in the first quarter.  In contrast, only once did a calendar year extreme in EUR/USD happen in the second quarter, and there were just two such in the third calendar quarter.  Six extremes occurred before January 10, and four were registered later than December 13.  The table below indicates the date of the euro’s calendar year peak and trough in each of the past eleven years.  The two all-time extremes, printed below in bold-face, were ironically among the furthest away from yearend.

  Euro High Euro Low
1999 January 04 December 06
2000 January 06 October 26
2001 January 08 July 06
2002 December 31 February 01
2003 December 31 January 02
2004 December 30 May 17
2005 January 03 November 15
2006 December 14 January 03
2007 November 23 January 12
2008 July 15 October 28
2009 November 25 March 04

Because of the rather consistent history of extremes near the cusp between calendar years, it is often possible with reasonably good confidence to identify a January-through-December floor or ceiling in EUR/USD before end-1Q in years provided a discernible cumulative movement takes place during the winter quarter.  In such instances, it can also sometimes be possible to guesstimate a rough band in which the other side of the high-low range for the entire calendar year is likely to lie.  The width of the high-low calendar year spread over the past eleven years was 14.9% or greater ten times, the exception being a width of 13.2% in 2007.  And the high/low spread for EUR/USD was 22.7% or less in all but two instances, those being 30.1% in 2008 and 26.6% in 2000.

Copyright Larry Greenberg 2001.  All rights reserved.  No secondary distribution without express permission.



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