The consensus forecast today for the Euro/dollar (EUR/USD) is a move up to 1.5000 and probably higher—perhaps a test of the July 2008 high above 1.6000. But this forecast is based on few facts and questionable assumptions.

All forecasts entail creating a scenario for the most likely outcome. Sometimes it’s all too easy to convince yourself a scenario is highly likely given certain facts and reasonable assumptions. But in a crisis situation such as today’s, not even "facts" are reliable and just about every assumption should be looked at with suspicious eyes.