Currency market review for September 21, 2011 (EUR/USD)

One misfortune comes on the back of another. So, investors relying on the euro growth feel the situation is getting worse. They are likely to suffer substantial losses, taking into account that the euro is technically breaking down in the charts.
On Monday the Greek finance minister claimed that the country will announce closing several state organizations and include further cutting the budget in the plan for 2012. Yet, as the government has been experiencing difficulties in fulfilling the conditions of new assistance rendering round, Greece and other eurozone countries seem to be losing their political will to prevent a potentially destabilizing default.

At present the situation outcome depends on whether the EU, ECB and IMF will manage to better their relations with the Greek government and provide a credible plan on maintaining the funds flow for preventing a default. Market participants have been rather doubtful about it so far. EUR/USD pair is now technically weak, below the 1.3717 level and is targeted to the last week low 1.3496 which is the record low since the pair dropped from its June low 1.3836.
Taking into account new lows of the downtrend, the pair is expected to test the 1.3117 level. In this case traders should fix their profit at the 1.3444 level.