EURUSD Movement
On Friday, EUR rose 0.34% against the USD and closed at 1.3056, as the EU leaders, at a meeting in Brussels, stated that balanced budgets remained the goal and that there was no talk of large-scale spending programs or bond issues. It also granted countries such as France, Spain and Portugal extra time to bring down deficits. Moreover, the European Central Bank (ECB) stated that commercial banks would repay another €6.82 billion of the Long-Term Refinancing Operations (LTRO) next week. Moreover, the annual core consumer price index (CPI) in the Euro-zone remained stable at 1.3% in February, in line with market expectations. Meanwhile, the CPI came in unchanged at 1.8% (YoY) in February, in line with market expectations.
In the Asian session, at GMT0400, the pair is trading at 1.2895, with the EUR trading 1.23% lower from Friday’s close, after an unprecedented levy on bank deposits in Cyprus threatened to derail the nation’s bailout and spark a new round in Europe’s debt crisis. On Saturday, the Euro-area finance ministers agreed to provide a €10.0 billion bailout for Cyprus on the condition that the nation would tax bank deposits to help pay for rescue. According to the condition, Cyprus would have to impose a onetime levy of 6.75% on deposits of less than €100,000 and 9.9% above that amount.
The pair is expected to find support at 1.2819, and a fall through could take it to the next support level of 1.2744. The pair is expected to find its first resistance at 1.3039, and a rise through could take it to the next resistance level of 1.3184.
Later today, investors expect the Euro-zone to post a narrower trade surplus January.
The currency pair is trading way below its 20 Hr and 50 Hr moving averages.
