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The EUR/USD pair fell during the session on Tuesday as the situation in Europe still seems far from being solved. The Italian prime minister mentioned on Tuesday that he could not rule out the Italians needing a bailout, this of course had many in the markets worried about the European Union yet again. At this point in time, it seems that only bad news is coming out of the region.
The 1.2250 level is significant as it has been support over the last couple of days. If we manage to break below the Tuesday lows, this should signal a run down to 1.20, and then possibly the 1.18 level. As for buying the Euro at this point in time, there is absolutely no reason to even consider it. Selling rallies will continue to be how we approach this market, and would even use lower time frames such as the four-hour chart.