EURUSD Movement
For the 24 hours to 23:00 GMT on Friday, EUR rose 0.12% against the USD and closed at 1.2564, after the European Central Bank (ECB) took a step seen as easing funding stresses for the region’s banks.
The ECB widened access to some of its funding operations by saying that it would soon accept a wider range of collateral for loans, including lower rated securities and some asset-backed debt secured by car loans as well as consumer and commercial mortgages.
Additionally, the German Chancellor, Angela Merkel resisted pressure on Friday for common Euro-zone bonds or a more flexible use of Europe’s rescue funds but agreed with leaders of France, Italy and Spain on a €130 billion ($156 billion) package to revive growth.
Meanwhile, on the economic front, the IFO business climate indicator in Germany dropped to a level of 105.3 in June, compared to a reading of 106.9 in May. Additionally, the IFO expectations indicator fell to a reading of 97.3 in June, while the IFO current assessment indicator rose to 113.9 in June. On the other hand, the consumer confidence index in Italy dropped to a reading of 85.3 in June, from 86.5 in May.
In the Asian session, at GMT0300, the pair is trading at 1.2535, with the EUR trading 0.23% lower from Friday’s close.
The pair is expected to find support at 1.2508, and a fall through could take it to the next support level of 1.2482. The pair is expected to find its first resistance at 1.2572, and a rise through could take it to the next resistance level of 1.2610.
Trading trends in the pair today are expected to be determined by the release of GfK consumer confidence survey in Germany. Additionally, the outcome of Germany and French debt auction would give further direction to the currency.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
