Forex: EUR/USD resting above 1.2840 after downtrend break up

FXstreet.com (Barcelona) - With the prospects of another bank holiday session in New York later in the day, and already breaking above latest descending trend line from mid Oct highs at 1.3140, EURUSD is at 1.2847 last, retracing from recent fresh 10-day highs at 1.2868. Market focus on data will shift to European turn on PMIs, with France, Germany, and the EU to release latest figures from 8 to 09:00 GMT, expected to come still below the 50 mark, which means contraction.

Meanwhile, market looks to be holding shorts over all, says FXWW founder Sean Lee: "It's very logical to be short and bearish of the EUR given the situation in Greece and Spain," the analyst notes, "but these shorts can easily get squeezed when markets are thin and liquidity worsens. That's what's happening at the moment and patient bears might get some good entry levels on exhaustive stop-loss spikes." EURUSD is higher by +0.79% for the week so far.

Immediate resistance to the upside for EURUSD shows at recent session and 10-day highs/200 day EMA/Nov 11 highs/26-29-30 Oct lows 1.2868/82, followed by Oct 24 lows at 1.2920, and Feb 16 lows at 1.2970. To the downside, closest support lies at previous weekly highs Tuesday/yesterday's 1.2830/5, followed by Nov 09/15 highs at 1.2802/1.2790, and Nov 05/06 lows at 1.2762/6.