Strong ISM has tempered expectations that the Fed will have have to relaunch a full-fledged quantitative ease, undercutting the need to flock to the euro as an alternative to the greenback. Firmer US interest rates are helping support the buck as well.
Profit-taking in EUR/JPY is weighing on the single currency at the moment as Japanese accounts remain in sell-rallies mode.Risk-traders are more focused on commodity currencies like AUD and CAD today rather than EUR/JPY as a result.
1.2780 is shaping up as very important support for EUR/USD. It is both the old trend high for the recent rebound as well as the 38.2% retracement of today’s 1.2663/1.2855 range. EUR/USD trades now at 1.2816.
