Judging by the price action seen Thursday, it looks as if one or more Central Banks (ECB, SNB) are intervening in the currency market on behalf of the euro.

After all, it isn’t everyday that we see the S&P decline a mind-numbing 3.90% as the euro appreciates.

It’s a well known fact that if a Central Bank intervenes on its own, the effort ends up being futile as market forces overwhelm the lone effort. But put two (or more) together and the market generally doesn’t stand a chance, especially if the Federal Reserve gets involved.

As if on cue, it was announced after U.S. markets closed on Thursday that Treasury Secretary Tim Geithner will visit Germany and the U.K. next week to discuss the European debt crisis.

Geithner’s trip to Europe will follow his visit to Beijing for the U.S.-China Strategic and Economic Dialogue. He will meet with U.K. Chancellor of the Exchequer George Osborne in London on May 26, then head to Frankfurt to meet with ECB President Trichet. The next day, he will meet with German Finance Minister Wolfgang Schaeuble.

Traders are likely to read between the lines of this announcement and come to the conclusion that the U.S. has seen more than enough dollar appreciation over the past few months. A strengthening dollar naturally makes U.S. exports less competitive, an important factor given that over half the profits made from companies which comprise the S&P 500 are derived from foreign sales.

I said at the beginning of the week that the euro currency crisis could pause, with a move into the mid 1.25’s before heading into the lower 1.27’s. Given that speculation of a coordinated intervention is likely to increase, a 50% retrace of the April 12 to May 19 decline looks to be well within the realm of possibility.

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