EUR/USD around 1.3050

FXstreet.com (Edinburgh) -The EUR/USD is now hovering hover the mid 1.30s on Thursday, as the celebration tone after Bernanke’s dovish speech seems to be dying off.

EUR/USD correction continues

Market participants are still gauging the last speech by Bernanke and the subsequent echo in the pair, as it now seems the any taper to QE would occur later than the September meeting. According to Dave Floyd, Analyst at Aspen Trading Group, “We might still see another modest push higher but the forecast remains clear: lower price levels towards 1.2514”.

EUR/USD key levels

As of writing the pair is up 0.61% at 1.3057 with the immediate hurdle at 1.3208 (high Jul.11) and then 1.3255 (high Jun.21). On the downside, a break below 1.2966 (low Jul.11) would open the door to 1.2949 (high Jul.10) and finally 1.2755 (low Jul.10).

EUR/GBP capped 0.8696

EUR/GBP rallied in NY and Asia to 0.8696 from the figure 0.8600.
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ECB Monthly Report: Interest Rates could be reduced further

The ECB signalized in its July Monthly Report that interest rates could be reduced further, should the price stability outlook warrant it. The recently introduced forward guidance was also included: “The Governing Council expects the key ECB interest rates to remain at present or lower levels for an extended period of time.”
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