Forex Flash: EUR/USD likely extending recent uptrend by the end of the week - Wells Fargo

FXstreet.com (Córdoba) - The euro received an early boost after ECB President Draghi reportedly told the EU lawmakers he would be comfortable buying three-year government bonds, however, the shared currency "has struggled to sustain those initial gains against the backdrop of weaker global equity markets and with Moody's lowering its EU rating outlook to negative", says the Wells Fargo analyst team.

"We note however that Eurozone peripheral bond yields are lower, which suggests markets are still looking positively to the ECB announcement later this week", they add.

"Our overall bias remains risk-positive", Wells Fargo says. "Fed Chairman Bernanke did enough to keep the hopes for September Fed easing intact last Friday, while we also believe the ECB will deliver the much anticipated details of its bond purchase plans this week".

"Although market reaction will be sensitive to the details of these plans, we see the euro likely extending its recent uptrend by the end of the week, with gains also seen in most commodity and emerging currencies", they add.