Is EUR/USD Finally Ready to Break Free of 1.30?

Daily Forex Fundamentals | Written by Lena Manousarides | Mar 13 09 16:37 GMT |

The week has come to an end, with markets rallying for the most of it! New York has closed positive yesterday and there is scope for more gains today! The European markets were up too, after investors welcomed better earnings reports from Banks and corporations. As a result, we saw weakness in the dollar against the euro and the pound, and EUR/USD moving higher towards important 1.30! The EUR/USD has been gaining consistently these days and as long as 1.2680-1.27 stays intact, there is further scope for higher moves! The next level to watch now is 1.2970 ahead of 1.30. If the latter levels give way then 1.3060 comes back in the game! However, with today being Friday and last day of the week and also G20 this weekend, traders maybe wait till the Monday open before they commit either way! The GBP/USD gained this week also, after a terrible start which saw the pair all the way down towards 1, 36. However in the last few days, the pair skyrocketed breaking important psychological support levels of 1.40 and printing a new daily high at 1.4070. Next level to watch is 1.4130 as it is a good resistance level and may keep for now amid weekend approaching. Investors feel more confident these days and the fact that more UK banks announced that are expecting profits in the coming months, is taking some comfort in traders' minds! Today the economic calendar had a few economic data, with Canadian employment numbers come out worse than expected, and also consumer confidence and trade balance out of US which came out better than expected, giving even more reasons for investors to increase their risk appetite for now! The dollar seems to be suffering today and yesterday as traders don't wish to buy it for safe haven reasons and the hope that things may stabilize sooner than later is giving investors a renewed confidence! Today, we have the G20 starting in UK, where 20 of the most industrialized countries in the world will get together to discuss the current economic global crisis and it will be monitored closely from investors for any signals as to what the world leaders are doing in order to bring stability into the financial sector! Yesterday we witnessed Swill National Bank taking matters at hand and intervene heavily on its currency, as fear of the gloomy economic outlook made the bank wary as to how suitable a strong Swiss franc is at current deteriorating conditions! Investors now speculate that other countries may follow Switzerland's example and therefore moves in the currency markets may be choppy and volatile in the coming days. Let's see how New York futures will close for the day and if the week will finish on positive territory! Don't forget that at such fragile market environments, rallies cannot be sustained for too long, as investors cannot afford to be long in a bearish environment! So it may be a case of not letting ourselves “fall in love with the upside” for now, but just enjoy the ride! For now let's watch how EUR/USD behaves at 1.30 and if the recent upside rally was enough to sustain further gains pass that level! In the last few months, the pair tried to break out of that level for many times, but risk aversion always came back to haunt it! Will the latest confidence in traders make euro bulls finally ready to “break free of 1.30? The coming days will be crucial for any direction in the currencies and also the outcome of the G20 this weekend… Lena Manousarides Independent Market Analyst and Professional Trader Email: manousarides@yahoo.comThis email address is being protected from spam bots, you need Javascript enabled to view it Lena Manousarides is a professional Trader and an independent Market Analyst, who pioneers in Fx trading in Athens, Greece. After several years of professional trading in the Forex Market, Lena formerly worked with FXGreece as a Market Analyst, writing articles on a daily basis, using fundamental and technical analysis. She also writes for several major financial newspapers in Greece and is in the process of becoming professional Commodity Trading Advisor.