EURUSD Movement
For the 24 hours to 23:00 GMT, EUR rose 1.10% against the USD and closed at 1.2280, after European Central Bank (ECB) President, Mario Draghi, signaled that officials are prepared to do whatever is needed to preserve the Euro and fighting high bond yields.
Meanwhile in Greece, coalition government has warned that letting the country fall out of the Euro currency union would spell “suicide for the Euro-zone.”
Additionally European Commission President, Jose Manuel Barroso, stated that his meetings with Greek government leaders have convinced him that the new Greek government is committed to reform. Separately, nation’s finance ministry stated it has identified €11.6 billion in spending cuts over the next two years to put its troubled structural reforms on track.
In a bond auction, Italy raised € 2.5 billion from the sale of its zero coupon bond due May 2014, at yield of 4.860%, the highest since November.
On the economic front, in Germany, GfK consumer confidence index climbed to 5.9 in August, from 5.8 in July. Separately, import price inflation slowed to 1.3% annually in June, from 2.2% in May. In Italy, consumer confidence index rose to 86.5 in July, surpassing the market expectation of 85.0. Moreover, the M3 money supply in the Euro-zone rose 3.2% (YoY) in June, from 3.1% in May.
In the Asian session, at GMT0300, the pair is trading at 1.2286, with the EUR trading marginally higher from yesterday’s close.
The pair is expected to find support at 1.2159, and a fall through could take it to the next support level of 1.2033. The pair is expected to find its first resistance at 1.2371, and a rise through could take it to the next resistance level of 1.2457.
Trading trends in the pair today are expected to be determined by the release of German consumer price index.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
