FXstreet.com (Barcelona) - The shared currency has received
another blessing from its rival the greenback, after the US Senate
and the House of Representatives have passed the bill that would
avert the so-called 'fiscal-cliff', albeit temporarily until the
debt ceiling discussions kick in again in six to eight weeks,
opening a new front of uncertainty that could be supportive of the
… No signs of improvement in Euroland
In the meantime, the key manufacturing PMI prints in the euro zone
members and the bloc composite did not show any sign of
improvement. Actually, totally the opposite is true with numbers
coming in either below expectations or previous readings. However,
the actual recession in the euro area and its gloomy prospects
ahead of the new year seem of little importance when compared with
today's big news regarding the US 'fiscal cliff'. Meanwhile,
markets keep following the risk trends… blindfolded.
A correction lower in EUR/USD should not be ruled out in the near
term however, as the pair has reached 'very' overbought readings,
although the mood dominating the markets might allow some extension
of the actual celebratory rally.
Technically speaking, expert Karen Jones at Commerzbank expects the
cross to consolidate between 1.3061 and 1.3155/40, gathering
strength for another attempt to higher levels. "Beyond this
consolidation, scope remains to challenge the 1.3487/1.3528
resistance area. This is where the February high… and the 200 week
moving average all come in and as such should offer strong
resistance and provoke failure", assessed the analyst.
The in-house Bullish Percentage Index (
) is also reflecting the last trends in the risk appetite, although
in a declining scope since the last week of December. The index
shows that 52.63% of euro-based pairs are still in bullish mode,
according to point and figure patterns.
… What Thursday brings to the table
Euro docket on Thursday is far from exciting, although the
unemployment rate in the first economy of the bloc would catch the
investors' attention, ahead of the ADP Employment Change in the US
and the FOMC minutes.