Forex: EUR/USD erases gains to 1.3030 on NY opening

FXstreet.com (Barcelona) - Following the drop to 1.2956 spike low yesterday on weaker German IFO survey, rising chances of a ECB rate cut, the EUR/USD has been stronger today and rose towards this week’s highs, printing a new one at 1.2994 high in reaction to German Chancellor Merkel comments, saying that higher interest rates would be better for Germany. However, profit taking there is erasing the daily gains and sharpened the drop on the NY opening.

Merkel wants that bank shareholders can also suffer losses in the future and said the government rejects common European deposit insurance, for now. Finland grand committee head said the Euro would survive in case Cyprus leaves and rejects euro-area fiscal transfers. IMF’s Lipton and PIMCO’s Amey suggested more ECB easing.

US initial jobless claims eased from 355K to 339K in the week ending at April 19, below the 351K consensus. Continuing claims also pleased investors with a drop from 3.093M to 3.000M, instead of coming in a 3.060M.

“Overall, range persists, with price now addressing towards the bottom in the 1.2970/1.3000 area, where buying interests wait”, wrote FXstreet.com independent analyst Valeria Bednarik.