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Forex: EUR/USD bouncing off lows, refocus on 1.2800

FXstreet.com (Barcelona) - The optimism is coming back to the euro traders on Thursday, as Cypriot banks are getting ready to re-open their doors after the long bank holiday. Markets remain calm so far, as the likeliness of a bank run shrunk somewhat as of late.

Greg Gibbs, FX Trading Strategist at RBS, comments, “The handling of Cyprus creates uncertainty in that it suggests there will be a tendency of EU leaders to take a harder line on future bailouts, particularly in small countries that may be seen as less systemically important. It suggests that richer countries like Germany are suffering bailout fatigue. In particular, it appears richer EU members will be reluctant to bailout banks of other countries”.

As of writing, the cross is up 0.08% at 1.2788 with the next resistance at 1.2815 (high Mar.28) ahead of 1.2867 (high Mar.27) and then 1.2883 (MA200d).
On the flip side, a breakdown of 1.2730 (low Nov.19) would aim for 1.2685 (weekly cloud base) and then 1.2680 (61.8% of 1.2042-1.3711).

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