The euro has sold off aggressively over the past 24 hours, breaking below at least 3 big figures in the process. After such a strong move, many currency traders wonder if there will be consolidation or continuation. Today’s sell-off in the EUR/USD was the strongest since January 5, 2009 and taking a look back at how the EUR/USD behaved at that time, we can see in the following chart that there was a 100 pip continuation the following day before consolidation.

Do you think history will be repeated? I do.

 

Kathy Lien is Director of Currency Research at GFT, and runs KathyLien.com.