Forex: EUR/USD eases back to opening price

After the sharp rally seen after the EMU current account data, though not moved in reaction to its figures, the EUR/USD was capped at 1.3379 high and returned to its opening price area, around 1.3350. An empty calendar and the US out of the picture today, leave investors with no particular interest for what's coming. However, low volumes could allow wider moves in the FX market.

For now, the EUR/USD trades quietly. At 14:30 GMT, we have ECB Draghi's speech. About ECB Draghi's position on exchange rates, saying they're not a direct political target but would of course influence growth and inflation projections, Commerzbank analyst Leuchtmann believes he was signalling that the stronger EUR/USD was a reason for more pessimistic ECB projections which might be used as an excuse for a rate cut. "Everyone is reassuring me that my concerns are unfounded. It is probably merely due to the fact that after the experience of the past 3 years nothing would surprise me when it comes to the ECB", he explained, concerned and pointing to a rate cut as fatal for the EUR/USD.

"On the upside, break above 1.3400, would provide relief, while only regain of 1.3500 zone, 50% of 1.3710/1.3305 would shift near-term focus higher", wrote Windsor Brokers analyst Slobodan Drvenica, pointing to 1.3300 offering initial support, ahead of 1.3285 and 1.3265.