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May 27, 2013
EUR/USD remains in highs around 1.2945/50
FXstreet.com (Barcelona) - The bloc currency keeps trading in the upper end of the intraday range around 1.2945/50 on Monday.
“The upticks may have to be fought for as many anticipate a refi rate cut next month and there is speculation that a negative deposit rate may be introduced then. With EONIA trading around 5 bp, another 25 bp rate cut remains more in the symbolic world than substantive. We continue to believe that the ECB will be persuaded that the cost (somewhat unknown) is greater than the benefits (elusive) of a negative deposit rate”, assessed the BBH Global Currency Strategy Team.
The pair is now gaining 0.05% at 1.2943 and a breakout of 1.2994 (high May 24) would then target 1.2998 (high May 22) en route to 1.3030 (high May 14). On the downside, support levels line up at 1.2904 (low May 24) followed by 1.2897 (MA10d) and finally 1.2821 (low May 23).
“The upticks may have to be fought for as many anticipate a refi rate cut next month and there is speculation that a negative deposit rate may be introduced then. With EONIA trading around 5 bp, another 25 bp rate cut remains more in the symbolic world than substantive. We continue to believe that the ECB will be persuaded that the cost (somewhat unknown) is greater than the benefits (elusive) of a negative deposit rate”, assessed the BBH Global Currency Strategy Team.
The pair is now gaining 0.05% at 1.2943 and a breakout of 1.2994 (high May 24) would then target 1.2998 (high May 22) en route to 1.3030 (high May 14). On the downside, support levels line up at 1.2904 (low May 24) followed by 1.2897 (MA10d) and finally 1.2821 (low May 23).