The pair closed in NY Monday at $1.3077 after recovering off a corrective pullback low of $1.3054, prompted by reported comments from ECB Draghi that ‘we will be looking at all the data that arrives from the Eurozone in the coming weeks and if necessary, we are ready to act again’. The rate had seen a high earlier in the day of $1.3141. A slow start in Asia, with main focus on the RBA rate decision (cut 25bps into Europe), saw rate eases off to $1.3068 before recovering through the balance of the overnight session to a high of $1.3090, trading around $1.3083 into Europe. Offers seen placed between $1.3090/1.3100 with stops noted above, but if triggered expected to meet further sell interest above the figure. Support seen into $1.3050 (weak talk of Asian sovereign demand), with stronger interest seen into the 55-dma (rate has bounced away from this level on 2 tests, post ECB rate cut and post NFP) which today comes in at $1.3021. Corporate demand is linked to bids between $1.3020/00, with stronger interest seen at $1.2980/70. French trade and IP data due up early Europe, followed by German factory orders at 1000GMT.
