EURUSD Movement
For the 24 hours to 23:00 GMT, EUR rose 0.72% against the USD and closed at 1.2854, on expectations that a German court would back the Euro-zone bailout fund following announcement that it would not postpone today’s long-awaited decision on European Stability Mechanism (ESM).
Meanwhile, the US dollar came under pressure amid growing expectations that the Federal Reserve is likely to ease monetary policy this week to boost a slowing US economy.
Additionally, the German Economy Ministry stated the outlook for the German economy is stable for the second half of this year, but it added the downside risks to the economy are still substantial.
On the economic front, the wholesale price index in Germany advanced 3.1% (YoY) in August, following a 2.0% rise in July. Additionally, French non-farm payrolls fell 0.1% (QoQ) in the Q2 FY2012, following similar fall in the Q1 FY2012.
In the Asian session, at GMT0300, the pair is trading at 1.2867, with the EUR trading 0.10% higher from yesterday’s close.
The pair is expected to find support at 1.2794, and a fall through could take it to the next support level of 1.2720. The pair is expected to find its first resistance at 1.2906, and a rise through could take it to the next resistance level of 1.2944.
The Euro is expected to take cues from the release of German Constitutional Court announcement on ESM. Investors also await Euro-zone industrial production and German consumer price index data, in the day ahead.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
