EURUSD Movement
For the 24 hours to 23:00 GMT, EUR rose 0.64% against the USD on Friday, and closed at 1.3458, ahead of the ECB’s second three-year long-term refinancing operation (LTRO) scheduled for February 29, in which it would lend up to €480 billion to banks at discounted rates.
On the economic front, the GDP in Germany contracted 0.2% (QoQ) in 4Q FY2011, the first time since the first three months of 2009, in line with initial estimates. Additionally, the Consumer Confidence Index in France climbed to a reading of 82.0 in February.
According to the reports, Group of 20 nations has asked Europe to come up with more financial firepower before they consider lending outside support. Germany has conveyed its readiness to discuss higher firepower for the Euro-zone bailout fund. On Saturday, German Finance Minister, Wolfgang Schaeuble stated that decision on increasing the size of Euro-zone’s bailout fund would be taken in March.
Separately, Italy sold €3 billion of two-year benchmark CTZ bonds, with the average yield declining to 3.013%, from 3.763% last month.
In the Asian session, at GMT0400, the pair is trading at 1.3457, with the EUR trading steady from Friday’s close.
The pair is expected to find support at 1.3381, and a fall through could take it to the next support level of 1.3305. The pair is expected to find its first resistance at 1.3510, and a rise through could take it to the next resistance level of 1.3563.
Trading trends in the pair today are expected to be determined by the release of Euro-zone M3 Money Supply and French Producer Prices.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
