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Forex: USD/CHF rises to 0.9480

FXstreet.com (Barcelona) - The market is trading wild ahead of the European opening as investors position themselves to the BoJ surprise earlier. The USD/CHF has quickly risen from 0.9450 to 0.9480.

Soon, Markit Services PMI data will be published in the Eurozone countries. Data is expected to get worse, particularly in France (from 43.7 to 41.9) and Germany (from 54.7 to 51.6 – still expansionary, though). “The final readings of the services PMIs will likely be ignored ahead of the ECB decision later in the day”, wrote TD Securities analysts.

“The press conference should be a busy one, with Draghi getting questions on the disappointing Eurozone survey data, whether some ECB members are still pushing for rate cuts, the Cypriot crisis and capital controls, contagion into Slovenian debt and worries of deposit flight elsewhere, and uncertainties over the Italian elections. There is a risk Draghi reinforces some of the disappointment in the data and ability of the ECB to respond if needed, but we don’t see them ready to act yet”, they concluded.

“The near term target is the 0.9595/0.9609 January 2012 high and the 61.8% retracement of the move down from the 2012 peak, which is expected to act as the break point to the 200 week ma at 0.9680”, wrote Commerzbank analyst Karen Jones, pointing to longer term target at 0.9972, the 2012 peak.

Forex Flash: EUR/USD consolidates at 200-day MA, with negative bias - Commerzbank

Commerzbank analysts see the EUR/USD consolidating below its 200 day ma and resistance line at 1.2892/1.2912, “and while capped here a negative bias is maintained”. “It remains on course for 1.2679/61, this is the 61.8% Fibonacci retracement of the July-to-January rise and the November 2012 low. We would allow this to hold the initial test and allow for some profit taking here”, wrote analyst Karen Jones, pointing to longer term target at 1.2400 and then 1.2042 (2012 low). “The 1.2912 resistance line guards last week’s high at 1.3050 which in turn guards 1.3100/80 – while capped here a negative bias is entrenched”, Jones added.
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