At the end of trading on Thursday, the euro rose sharply against the dollar, recovering with most of the previously lost positions. The fall of the euro, in the beginning, it was caused by a report on the current account surplus of the euro zone, which fell in May compared with the previous month. The European Central Bank reported that the decrease is caused mainly due to the higher deficit in current transfers and income decline.
The second factor reducing EUR/USD began to economic data in the U.S. . After reporting a significant increase in initial claims for unemployment benefits in the U.S. last week, the Labor Department released a report that showed that last week the number of initial claims for unemployment benefits fell more than expected. The report states that the primary applications for unemployment benefits in the U.S. last week fell from 24 thousand to 334 tysysyach. The dollar also helped the Philadelphia FED manufacturing index, which also was better than analysts' expectations.
An important event that turned the tide in favor of the euro currency trading, was the speech from FED Chairman Ben Bernanke, who told the Senate that the decision had been taken that the central bank will cut its September meeting, the bond purchase program of 85 billion dollars a month. Many analysts on Wall Street have chosen a meeting mid-September as the most likely point when the FED may make the first cut of the program, in part because after the meeting scheduled press conference. Replying to questions in the Senate Banking Committee, Bernanke dismissed the date as something predestined. According to Bernanke, the decision to initiate folding of the program will depend on whether the FED sees that the improvement in the economy, which it expects in the second half of the year. In the meantime, did not leave a lot of data since the last FED meeting, held on June 18 - 19, after which he set out the approximate time to minimize the program. And the data that came out after the June meeting were "mixed", he said.
Because of the uncertainty in the market for the pair EUR/USD seems ready to move between levels of 1.30 - 1.32 . These values are key to the pair break the upper limit will pave the way to a level of 1.33, at which the euro will be waiting for the strong resistance formed by the horizontal and descending trend line. A move below the level of 1.30 is a signal to sell EUR/USD pair with the objectives of 1.28 - 1.26 . We are of the opinion that, in this currency pair is the determining factor in the trend line, which is directed downwards, so traders are better on the side of the bears because prospects bulls are very vague.Social button for Joomla