Charts suggest the euro could see a ‘swift rally’ and lift the market with it, says Jim Cramer

CNBC’s Jim Cramer on Wednesday said that the euro could rise in value in the near future, relying on analysis from DeCarley Trading technician Carley Garner.

“The charts, as interpreted by Carley Garner, suggest that the euro’s ready to rebound — if not now then very soon — and I wouldn’t be surprised if she’s right and it helps take the whole stock market up with it,” he said.

The U.S. dollar and euro on Tuesday reached parity, or the same worth, for the first time in 20 years. While the U.S. dollar index has been on the rise, the euro zone’s energy supply crisis and economic problems have put pressure on the euro’s value.

To explain Garner’s analysis, Cramer first examined the monthly chart of the euro-to-dollar exchange rate over the last two decades.

While the euro was trading at $1.60 in early 2008, it has stayed between $1.05 and $1.20 for most of the last ten years, Cramer said. He added that Garner believes the current sell-off is noteworthy, since the currency typically doesn’t dip below $1.03.

“With so [many] traders trying to push the euro down. … She wouldn’t be surprised if there’s one last probe down to crush the remaining bulls before the thing can bottom and start rallying,” he said.

That means the euro could briefly touch 97 or 98 cents compared to the U.S. dollar, according to Cramer.

“Once the narrative shifts, Garner’s predicting a swift rally. Back in 2017, the euro dipped below $1.05 … but within a year it was back to above [$1.25],” he added.

For more analysis, watch Cramer’s full explanation below.