Euro falls hard for the week

The EUR/USD pair broke down below the 1.21 handle during the week, slicing down to the 1.19 region. This is a major turn of events for this pair, as the market has started to react to the higher interest rates in the United States. This of course has the market falling as the US dollar starts to become more attractive. Perhaps this is a bit of a reaction to the statements coming out of the European Central Bank that interest rates may stay low for an extended amount of time, and that of course is bad for the Euro itself.

Ultimately, I think that there is a massive amount of support at the 1.15 handle, but that might be where we are going over the longer term. It looks as if the summer is lining up for US dollar strength, but if we were to turn around and break above the 1.21 handle, the market could continue to go much higher, perhaps reaching towards the 1.25 level again. The recent bullishness of course has been very extensive, starting in late 2016. While this appears to be a negative turn of events, this will more than likely end up being a pullback and once been a longer-term move. When looking at the longer-term charts, we were originally and a 1000 PIP range for a couple of years, which measured for a move to the 1.25 level. We have completed that, so we will have to look for a clearer longer-term technical set up.