The EUR/USD pair broke out to the upside on Monday as the Federal Reserve Chairman suggested that the exceptionally low interest rates in the US will remain for as long as possible. Some people went so far to suggest he was hinting at Quantitative Easing 3 as well, but wither way this was a Dollar-negative remark. The Dollar lost against almost everything except the Yen, and the Euro was no different.
Looking ahead, the real fight will be at 1.35, and with the Monday session closing so close to the highs, it looks like the pair will certainly try that area above. With this in mind, we would buy the pair on pullbacks more than anything else at this point. 1.35 will have to be watched for signs of failure by the bulls though.
Written by FX Empire