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Forex pairs in this Article » EUR/USD (Athens)- The EUR/USD soared on news wires suggesting that “Obama accepted Summers decision to withdraw” and that Yellen ( a much more dovish choice) is the “hot favorite”.

EUR/USD soars after Summers pulls out for contention; risk on due to US-Russia deal on Syria

The EUR/USD climbed to 1.3381 in early Sydney’s trading (gaining roundly 80 pips), on news says that Summers the most dovish choice is the “hot” favorite to take over Bernanke’s position. What’s more, the pair also gained solid ground on news suggesting that US agreeing to a Russian plan to start the inspection and removal of Syria’s chemical weapons within weeks, at least in principle.” While, we had very positive developments in Syria’s issue, as well as on the Summers being the new “favorite”, the news on behalf of Euro land weren’t as supportive as most investors might anticipate. Elaborating on, Bavarian state elections saw a very strong showing for the Christian Social Union allied to Chancellor Merkel but her coalition partner the Free Democrats won only 3% of the vote. Thus, if the FDP party has a same percentage in the upcoming elections, Merkel would be in a very distressing condition to form a coalition with parties that are not in her administration.

Technical Outlook on EUR/USD

Calendar is hotting up as we are ahead of NY Empire Fed Index and Industrial Production. Emmanuel Ng of OCBC Bank is neutral on EUR/USD in the near term. What’s more he suggests that “We stay neutral on the EUR-USD in the interim with 1.3350 likely to cap on the back of Draghi’s latest remarks while the 55-day MA (1.3209) may continue to provide a useful downside reference point.”
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