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Forex Flash: What lies ahead of EUR/USD? – Commerzbank and UBS

The bloc currency is picking up pace beyond the key mark at 1.3400 on Wednesday, leaving the comfort zone around 1.3350 bolstered by yesterday’s positive print from the German ZEW Survey.

“The market has started to erode the near term downtrend at 1.3418 and we would allow for a near term recovery. Provided rallies remain capped by the 1.3520 resistance they will have no impact on our negative bias. Above here will suggest another run up to the 1.3711 recent high”, assesses Karen Jones, Head of FICC Technical Analysis at Commerzbank.

In addition, G.Yu and G.Berry, Strategists at UBS, confirm the neutral bias on the cross, adding “There is strong support at 1.3270. Only a closing break below this would trigger deeper sell-off to 1.3187. Resistance is at 1.3393 ahead of 1.3520”.

Forex Flash: EUR/USD in near term recovery - Commerzbank

The EUR/USD seems to be recovering from the 1.3315/1.3290 area of support (long term Fibo retracement and the 3 month uptrend): “The market has started to erode the near term downtrend at 1.3418 and we would allow for a near term recovery”, wrote analyst Karen Jones. “Provided rallies remain capped by the 1.3520 resistance they will have no impact on our negative bias”, continued the Commerzbank analyst, suggesting another run up to 1.3711 in case of a breach higher. Below, there is a broad band of support extending down to 1.3202: “We have the 16th Jan low, the 61.8% retracement, the 55 day ma and the 3 month support line together with the 7 month uptrend and a close below here is required to negate the up move completely”, she added.
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Commodities Brief – Gold hovers above 1600 level, precious metals eye FOMC

Gold price managed to hold above the 1600 level entering European trading Wednesday (1603.65 session low) as price peaked briefly at the 1609 region before abruptly returning its daily advances. This recent move has become commonplace in recent days, as the unsettled situation of Hedge Fund Managers and the aftershock of the G20 conference still provide weaknesses for the yellow metal. At the time of writing, Gold is trading at USD $1605.09 per oz, clinging to positive territory. One key event stands out today as Gold traders will turn their attention to the release of the Federal Open Market Committee minutes, looking for any signs or clues after FOMC members indicated that they intend to end their $85billion monthly bond purchases sometime in 2013, with members divided between a mid- or end-of-year finish.
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