According to Marc Chandler, Global Head of Currency Strategy at BBH: "The technical outlook deteriorated markedly with the break below support at $1.28. It had two outside days in the past week, where it traded on both sides of the previous day's range only to close lower on the session. On Friday, one of the outside days, the euro closed below Thursday's low."
"Price action may be seen as failed attempts to rally and suggests overhead supply. Perhaps many of those fund managers who moved toward benchmark euro zone exposure in Q3 are beginning to hedge. Downside objective is found just above $1.26 and $1.2475. A move back above $1.2825 would be helpful, but it may require a move above $1.29 to be constructive" Marc adds.