Opened early Europe at $1.2293, EUR/USD closed in NY at $1.2270 after recovering from a session low of $1.2175, the move up boosted by the release of weak US retail sales, to highs of $1.2290. The weak data boosted FX market expectations of QE3 with attention focused on this afternoon’s testimony from Fed’s Bernanke (1400GMT). Rate continued to slip off recovery highs into early Asia, touching a low of $1.2265 before fresh buying emerged. Stops above the NY high targeted, the break taking the rate on to $1.2314 before move met stiff resistance from US and French names. Rate drifted to $1.2290, holding $1.2290/00 into Europe. Asian sovereign sales into Europe pressed rate down to $1.2280 but failed to trip short term stops placed below $1.2275. Rate recovered to $1.2310, aided by a good Spanish bill auction before momentum again faded. Release of weaker than forecast Germany ZEW data dipped rate back to $1.2285 only for fresh buyers to emerge and take rate up to extended highs of $1.2317. Offers into $1.2320 countered before rate settled around $1.2300 ahead NY.
EasyForexNews Research Team