Let's take a closer look at this recent breakout of the EUR/USD. (Click on the image below to enlarge it).

The chart on the right shows the EUR/USD's breakout higher towards 1.60. In fact, it got within 20 pips or so from that round figure. So tomorrow, the media will probably go ahead and call it 1.60.

Of course when currency pairs get that close to a major round number, many times they are drawn towards it like a magnet. So it could hit it overnight. But is it sustainable?

The chart on the left shows the USD/CHF which trades inversely to the EUR/USD. When the EUR/USD took out its upward resistance...at some point in the day, typically, the USD/CHF would have taken out its support level. However, as of this writing, that hasn't happened yet.

So watch USD/CHF to see if there will be "follow through" on the EUR/USD. If it can actually break lower, then the rally upward on EUR/USD may actually have some "legs".

If USD/CHF fails to close below its support, then I remain suspect of the EUR/USD rally being genuine.

Also, keep an eye on the oil chart. You can do this by going to www.stockcharts.com and putting in $WTIC as the ticker symbol. So that's the dollar sign plus WTIC.

Why? Because the EUR/USD chart and the oil chart have almost been identical to each other. They've both been running together for quite some time as an "anti-dollar" play. So if oil continues to set record highs tomorrow like it did today, then the EUR/USD rally may have some legs.

Oil has hit a high of $115.21 a barrel as of this writing. So if we see even "higher highs" in oil, we may very well see the same in the EUR/USD. However, if we don't see more "follow through" in oil, then we may see that the EUR/USD rally was a false break or a "fake out" to traders. If so, beware...the pros will try to scare the crap out of you as they take the pair lower.

So keep an eye on USD/CHF and the oil chart to see where EUR/USD's next move may be.