The EUR/USD initially looked very bullish for the session on Monday, as it sliced above the 1.3250 resistance area. However, as the Italian election results started to come in, anti-austerity politicians did much better than anticipated. This suggests that there may need to be a second election in Italy, and this of course throws a huge monkey wrench into the debt plans, causing panic and uncertainty in Europe itself. Because of this, the Euro lost against everything, and of course fell to the US dollar. This candle does look very brutally ugly, and it does look like one that will continue. On a break of the 1.3050 level, we would begin to sell again and aim for the 1.30 level, which of course is that gives way we think this market really starts to come undone.
Written by FX Empire