Mondays trade session was calm for the EUR/USD cross, after strong data from Germany was released last Friday and also expectations for a near-term exit of FED easing program boosted demand for US dollars.
The pair reached 1.2946 during late hours of the Asian trade session, highest value for today, then EUR/USD fell slightly to 1.2936. Support was expected to be provided at May 21st low, 1.2841, while resistance was expected at May 22nd high, 1.2998.
On Friday Germanys IFO Business Climate indicator rose to 105.7 during May, exceeding both expectations and previous month reading, 104.4. IFO Expectations indicator for Germany remained stable at 101.6 during May, while IFO Current Assessment indicator improved to 110.0 during May from a revised reading of 107.3 during the preceding period. These indexes bolstered optimistic expectations, regarding Germanys economy.
On the other hand, US dollar remained under support after Fed Chairman Ben Bernanke announced a decision to reduce scale of FEDs 85 billion dollar monthly bond purchasing program could be taken in the next meetings, depending on economic conditions.
Additionally, Wednesday’s FED minutes showed a number of policymakers were prepared to taper bonds purchases in June.
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