EUR/USD dropped more than 200 pips mainly after dovish comments from the President of the Central Bank Mario Draghi. He expressed a special concern regarding the low inflation in eurozone which needs to be lifted quickly. Traders short the euro by interpreting his comments as further monetary easing from the ECB is underway.
Single currency remains under selling pressure ahead of the important German Ifo Business Climate Index report release today.
EUR/USD prices broke down the bearish flag signaling further decline and prices could reach the potential target area at $ 1.2170. Prices may try to retrace back to retest the lower line of the flag as a pullback. Since the main trend is bearish, so any rally provides a good opportunity to “short” the pair.