Forex: EUR/USD jumps to 1.3100 on European opening

FXstreet.com (Barcelona) - The EUR/USD is starting the week in strength after closing Friday trading above 1.3000 and investors cheer this weekend’s news of an Italian coalition government, with PM Lette (PD) forming an alliance with Berlusconi’s PDL party (even though he is not assuming any senior ministerial positions, he remains popular and influential), while Grillo’s Five-Star party refused to join, as expected. The market will also be pricing in expectations regarding the ECB meeting and the FOMC meeting this week.

For this European morning, the EMU confidence report and German CPI will be attracting attention. After establishing support at 1.3040 zone, the EUR/USD ran off towards the 1.3100 mark ahead of the European opening, where it eventually reached, with gains greater than +0.50% on the day. At the moment of writing, the pair is quiet at 1.3094, last week’s high.

“Ahead of here lies the 2013 resistance line at 1.3123”, wrote Commerzbank analyst Karen Jones, focused on the 1.2954 200 day MA. “We should see failure shortly and a slide to 1.2839, the 78.6% retracement of the move up in April”, she added.