Sterling reached an important milestone on Wednesday when the pound touched €1.4250.
It had been supported around there in 2005, 2006 and 2007. When it eventually broke down through that support in late 2007, it went on to fall another 40 cents. It took seven years to recover to €1.30 and when it did, two and a half months ago, the old support became the new objective.
And when it got there it reacted in time-honoured fashion: it dropped back.
There was a similar reversal for the US dollar on Thursday. A growing chorus of pundits had begun - somewhat belatedly, it must be said - to predict that the euro would fall to parity with the dollar. It was such an obvious target that the world and his wife were short of the euro.
In the event, a number of them decided not to hold out for the last inch: When it got down to $1.05 they opted to take their profits. Seeing the euro stop dead, others decided to join them and the dollar rebounded as they bought back their short positions.
The big question now, therefore, is whether the euro's rebound against the pound and the dollar means a reversal of its downward trend or if it is simply a correction which will in due course give way to another downward leg.
It is pointless to guess which will turn out to be the case. It is not pointless, however, for would-be buyers of the euro to consider carefully whether its current levels present an opportunity. A 12-year low against the dollar and a seven-year low against sterling are not to be sniffed at. Yes, it is likely that the euro will resume its decline. But when, and what will happen in the meantime? Butter today or jam tomorrow?
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