EUR/USD: Former Range Lows Tested; Mid-East Blamed for Rally

EUR/USD has tested the mid-1.2930s twice so far but has not been able to overcome it as yet. Dealers are blaming the bulk of the EUR rally on Mid-East buying of EUR/USD, with talk of upwards of EUR 3 bln taken out of the market. The buying has helped turn the crosses higher as well, fueling the surge. Offers are seen through 1.2950 while an hourly downtrend comes in at 1.2965. Expect more short-covering if broken.