EUR/USD is consolidating gains after breaking higher overnight, overcoming resistance in the 1.3050 area and again toward 1.3070/75. 1.3100 barrier options attracted prices and now 1.3110s are rumored as well. 1.3120 is a technical hurdle, the 50% retracement of the 1.3365/1.2865 drop.
Yesterday's wider trade deficit in the US is prompting downward revisions to Q4 GDP while Eurozone GDP forecasts are being raised. A steady Fed and a proactive ECB are the medium-term status quo barring any surprises from Bernanke today.
US retail sales are set for release shortly. A 0.4% rise is expected. The consensus seems low considering the very strong chain store sales data reported for January, so watch for an upside surprise. 1.3050/60 is support on dips near-term.
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