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EUR/USD rising to alert us towards 1.27 handle

FXStreet (Barcelona) - EUR/USD is trading at 1.2674, up 0.04% on the day, having posted a daily high at 1.2692 and low at 1.2623.

EUR/USD is up to test territory for the 1.27 handle while the more committed dollar bulls are now being rattled as the EUR/USD begins to consolidate into positive territory between 1.2600 and the highs of today. The FOMC minutes could well be the catalyst for a test of the handle should sparks fly on a hawkish tone there. However, that said, the language, although if first sounding hawkish, may then indeed be interpreted again as much of the same, using "Dudley’s most recent as an example, when he again indicated that expectations for a rate hike in mid-2015 are "reasonable." Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman pointed out that this simply suggests a rough definition of "considerable period.”"

Although the minutes are of interest, what really counts more is the Fed on the day and action in policy for a longer term effect on trend as the guidance is much of the same beat of the drum. The wheels of divergence between the two central banks are already in motion and the dollar is firm in that respect.

EUR/USD noteworthy levels

Spot is presently trading at 1.2675, and next resistance can be seen at 1.2683, 1.2692, 1.2707 (Daily Classic R1), 1.2744 (Daily Classic R2) and 1.2776 (Daily 20 SMA). Next support to the downside can be found at 1.2669, 1.2657 (Hourly 20 EMA) and 1.2645 (Daily Classic PP).

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