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Session Recap: USD extends gains; EUR/USD closes below 1.2950

FXstreet.com (San Francisco) - The Greenback traded higher on Tuesday as traders are turning more dollar bullish and the smart money is moving to the US. Wall Street closed in a new all time highs and 10-year yields is above 1.95%.

Confidence in US recovery was fueled by the widely followed Appaloosa manager David Tepper that stated he is "definitely bullish" on stocks. Tepper said that employment, housing and financials are improving in the US.

Meanwhile, Fitch upgraded Greece rating from CCC to B-, still 'junk' while the ECB's Asmusses said the German economy is 'relatively robust'. Gold declined to $1,425.

The EUR/USD is closing below the 1.2950 key level for first time since April 4th and market is expecting the next bearish wave to 1.2880. As FXstreet.com Chief analyst Valeria Bednarik comments, "in the 4 hours chart 20 SMA presents a strong bearish slope, indicators hold in negative territory: as long as below 1.2970 now, there’s scope for a test of 1.2880 area, which has been a major support/resistance over the past few months."

The USD/JPY did a one more step and the pair is now trading above the 102.00 level at highest since August 2008. The break came after news from Kyodo reported that Japanese PM Abe will announce a second set of growth strategies on Friday.

The GBP/USD is ready to test the 1.5200 area after declining 400 pips in May. The AUS/USD continues its sell-off and currently it si trading below the 0.9900 area. Market expects further bearish movements and the testing of the 0.9850 long term support.

USD/CHF rallied to the highest since August 21, 2012 and the USD/CAD climbed around 100 pips on the day to trade at May's maximums at 1.0180.

Main headlines in the American Session:

US: Import Price Index fell 0.5% MoM in April

Commodities Brief – Precious metals bounce off intraday lows, crude testing 95.00

Abenomics 2.0 coming on Friday – Kyodo

Fitch upgrades Greece to B- with outlook stable

Wall Street rallies as investors are 'definitely bullish'

Wall Street rallies as investors are "definitely bullish"

The US stocks market closed Tuesday with gains as investors were impressed by the widely followed hedge fund manager David Tepper that stated he is "definitely bullish" on stocks. In this way, Wall street confidence on an economy on track dominated the sentiment.
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Forex: EUR/USD forms daily bearish engulfing as 1.2930 penetrated

The Euro/US Dollar has extended its fall late in the NY session as liquidity get thinner. The exchange rate has officially entered demand area between 1.2930/2900 following the excess of buying interest that existed right around that area last April 4. For now, the lowest level seen is at 1.2913.
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