The Euro appears to be relatively stable this week, with a current rate of $1.2304. It actually reached a Wednesday morning (June 16) high of $1.2355 before receding a bit in the mid morning trade.

At its high point for the day, the Euro was up nearly five pips over its long-term low of $1.1876 which it saw just one week ago. The major credit crisis that has affected some of Europe’s largest economies, including Spain, Greece and Portugal, has served as the catalyst to drive Europe to multi-year lows recently.

However, despite hardship remaining in many economies, speculators have driven the Euro higher in the last week based on the expectation that the worst-case scenario of bankrupt countries has likely been averted.

One benefit of a unified member currency is that the countries affected can turn to member nations for help based on the mutual interest in protecting the value of the common currency. Germany and other leaders worked quickly to development assistance and support programs for Greece, the first country to become a focus of debt issues in Europe.

There have been widespread rumors in the last 24 hours that the EU, International Monetary Fund and the US Treasury have been collaborating on a bail out safety plan for Spain that would include a credit line worth around $335 billion (250 billion Euros). Both the EU and the IMF were quick to denounce the rumors and said there was no truth to them.

The 16- member countries that use the Euro already setup a $543 billion (440 billion Euro) special assistance fund earlier this month to support any country that faces a similarly dire situation to that of Greece.

It is going to be interesting to see how things play out for the Euro over the next few weeks as unstable conditions often produce volatility and directional swings as emotions change from fear and panic to relief or hope.

For the moment, it appears as though speculators are comfortable sitting tight with their Euros in hand until they have a reason to do otherwise. Still, long-term charts suggest more downward movement is likely unless the Euro pushes back through the $1.25-1.26 level.