EUR/USD should see further downside
The weekly timeframe bearish engulfing bar on EUR/USD has been confirmed by a move beneath the previous weeks range low. When taking this into consideration, and the strong move through the daily time frame trend line shown in the chart below, further downside looks to be a distinct possibility for the leading FX pair.
Any retrace has been sold heavily so far with a drop of over 850 pips seeing only a 219 pip retrace to date. A combination of highly leveraged longs taking profit and speculative shorts entering the market have contributed towards a major bearish wave down.
The fundamentals are also supporting the dollar in the near term with the Euro Greek debt situation dominating.
Longer term dollar weakness should return but the current sentiment favours shorting the EUR/USD pair.
See Forex-fx-4x for further Forex trading analysis