What an incredible week! The euro finally broke its range and with determination, and pound is testing its long setup again after a 850 pip drop.

Euro: After the incredible 700 pip drop of the past week, the euro is still in short setups after rebounding at the 1.35 mark. The euro clearly broke the range it had been in throughout the summer and with it the long setup it was in. It is a clear break.

On the 15 min chart, you can clearly see the next extension short the euro is in at 1.3733, which coincides with the daily pivot at 1.3739. This may hold the euro into its next short, which has a target at 1.3385. However, after a 700 pip drop, if the extension short is broken at 1.3789, we can expect a more significant pullback. The full extension short on the daily chart is at 1.37743, with a target at 1.3365. The full 50% long from the June 2010 low at 1.1876 to May2011 highs at 1.4945 is at 1.341.

Pound: On the daily, the pound has dropped 850 pips since August 19th and has found its former support level (from July 2011) and 50% long at 1.5765. The pound long setup is only broken at 1.55315. The pounds reaction over the next few days will determine if the pound will continue in a range or if it intends to break its long.

On the 15 min chart, the pound is reacting to its 50% at 1.588, with a target at 1.572. If the short is broken 1.5906, a larger pullback would not be surprising after a large drop.

Yen: on the daily, the yen is meeting resistance at its 50% short at 77.67, which has a target at 75.128, which would be an all time low. The short is broken at 78.082.