In general, the exact reason for the drop was unknown. However, note that recent strikes of food producers in the Euro Zone have resulted in fishermen blocking major ports. It could be that the move was initially fueled by the decline in demand for the European currency by the fact that there would be no payments for EU export being exchanged from USD to EUR.
Economic Calendar Analysis
Watch out for the Wednesday's Federal Reserve's FOMC Meeting Minutes at 18:00 GMT.
On Thursday, the ADP Non-farm Employment Change might impact the markets through the value of the US Dollar.
On Friday, the United States are scheduled to release their monthly employment data at 12:30 GMT. Expect the data release to consist of the Average Hourly Earnings, Non-Farm Employment Change and the Unemployment Rate.
EUR/USD hourly chart's review
From a technical analysis perspective, the pair might aim at the 2017 low level at 1.0340 and the lower trend line of the channel down pattern, which has been guiding the rate during the recent weeks. Further below note the weekly S1 simple pivot point at 1.0323.On the other hand, a potential recovery might face the 1.0380/1.0385 zone as resistance, before the rate reaches the 50 and 100-hour simple moving averages near the upper trend line of the channel up pattern at 1.0420.
Hourly Chart
EUR/USD daily chart's review
On the daily candle chart, the pair has passed the low level zone of 1.0340/1.0400. In theory, the pair has no technical support as low as the lower trend line of the channel down pattern near 1.0050.If no round exchange rate level provides support and the monetary policy of the ECB and the Fed remain unchanged, the EUR/USD might soon reach parity.
Daily chart
Read More: Technical Analysis
Long sentiment continues to increase
On the Swiss Foreign Exchange, trader open positions were bullish, as 68% of open position volume was in long positions.
Meanwhile, trader set up pending orders in the 100-pip range around the pair were 51% to buy the Euro against the USD.
On Monday, trader positions were 65% long and pending orders were 60% to sell.