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Forex Flash: What does the EUR/USD have to offer? – Westpac, Commerzbank and UBS

FXstreet.com (Barcelona) - The single currency is prolonging its march north on Monday, flirting with the key mark at 1.3100 as risk appetite is prevailing in the global markets after the Italian elections.

“Weak US data and full pace Fed QE encourages demand with a 1.29 handle but it is hard to see the ECB meeting on Thu playing EUR-positive. While we expect a steady hand, the Draghi press conference should help cap any bounce to 1.32, given EZ economic deceleration including Germany”, suggested Sean Callow at Westpac.

Karen Jones, Head of FICC Technical Analysis at Commerzbank, commented the cross has been meandering between 1.2954/1.3050 last week, adding “These relatively small ranges are giving few clues to direction, however given the markets recent failure at its 50% retracement at 1.3225 our negative bias remains. Ahead of here lies the 2013 resistance line at 1.3123”.

While keeping the neutral bias on the cross, Strategists G.Berry and G.Yu at UBS argued, “Resistance is at 1.3108, a break above this would open the more critical 1.3202 and then 1.3232. Support is at 1.2955 and 1.2920 – a breach here would be a bearish development”.

Forex Flash: Majors look neutral ahead - UBS

UBS Strategists Gareth Berry and Geoffrey Yu have taken a technical look at today´s majors and see that the outlook is broadly neutral ahead.
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Forex: EUR/USD jumps to 1.3100 on European opening

The EUR/USD is starting the week in strength after closing Friday trading above 1.3000 and investors cheer this weekend’s news of an Italian coalition government, with PM Lette (PD) forming an alliance with Berlusconi’s PDL party (even though he is not assuming any senior ministerial positions, he remains popular and influential), while Grillo’s Five-Star party refused to join, as expected. The market will also be pricing in expectations regarding the ECB meeting and the FOMC meeting this week.
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