EUR/USD Price Forecast – Euro Falls Again on Tuesday

The Euro has broken down a bit during the course of the trading session on Tuesday to break down below the 1.16 level. This of course is an area that will attract a certain amount of attention due to the fact that it had been supportive previously, and the fact that we broke down through it last week will have attracted a lot of attention as well.

EUR/USD Video 06.10.21

Most of this has to do with the US dollar rather than the Euro itself, as we are seen interest rates in America rise during the session. This makes the US dollar more attractive; it makes a certain amount of sense that the Euro would be one of the main victims. I do believe at this point it is only a matter of time before we see follow-through, and if we break down below the lows of the last several sessions, then the pair will almost certainly work its way down to the 1.15 handle. In that scenario you have a lot of options barriers coming into the picture, and that of course has a certain amount of influence as well.

Pay attention to the 10 year yield, if it continues to climb that will push this pair much lower. Rallies at this point will have to deal with the 1.17 level where we have seen the last impulsive move to the downside, and therefore one would assume that there should be plenty of order flow in that general vicinity. I believe at this point we continue to see a lot of negativity in this market, and therefore I do not trust rallies at all. Selling signs of exhaustion would be the way to go.

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