Closed in NY at $1.2735, off pullback lows of $1.2711, after rate had seen highs earlier in the session of $1.2810. Risk appetite reemerged into Asia, with early demand lifting the rate from its opening level at $1.2735 to an eventual high of $1.27876(76.4% $1.2810/1.2711) with real money seen leading the buy interest. EUR short covering in several crosses, notably EUR/AUD and EUR/CAD, aided the move. The positive sentiment was seen as a reaction to reports that the Greece was nearing a debt deal with private creditors, as well as speculation China could cut its RRR before the end of the month (some suggest ahead of Chinese new year Jan23). EUR/USD trades into Europe off best levels, currently around $1.2760. Market appears to want to be positive toward risk but remain aware that this sentiment could be quickly reversed on negative headlines(eg Greek debt agreement failure). Offers are seen in place from around $1.2790 and said to extend through Tuesday’s high at $1.2810 to $1.2820. Further offers $1.2840/50. Support seen into $1.2740/35, stronger between $1.2710/00.
EasyForexNews Research Team