EUR/USD breaks through 1.32, no signs of buyers

By FXstreet.com | Updated August 24, 2014 AAA

FXStreet (Bali) - The US Dollar has opened awfully bid the Asian markets, having broken 1.32 round number against the Euro, setting yet another fresh year high - not seen since Sept 6, 2013, - at 1.3196.

The market's verdict after hearing Fed's Yellen speech last Friday appears to be clear, given the major boost given to the US Dollar through interbank trading hours. While Yellen failed to take a definitive side during her speech, with 'conditionalities' still dominant to make a decision on when to raise rates, the US Dollar continues to exhibit clear characteristics of a bullish currency, as traders ignore Yellen's rather neutral stance, to instead take any little piece of evidence to provide greater confidence that US rate hikes are indeed coming sooner-than-expected.

A weekend piece from Reuters may have given the USD bulls yet another reason to accumulate longs, noting that pressure keeps building within Fed to signal new policy course. According to the article, "pressure is building for officials to move as early as next month to more clearly acknowledge improvements in the U.S. economy and lay the groundwork for the central bank’s first interest rate hike in nearly a decade."

"According to some U.S. central bankers and their close advisers, signs of economic resilience and growing anxiety about the risks of holding rates too low for too long have set the stage for an intense debate over rewriting their policy statement", the article adds.

According to Chris Capre, Founder at 2ndSkies: "For now, we are maintaining a bearish view in EUR/USD while the price action is below 1.3350 on a daily closing basis. Until then, we'll look for pullbacks towards 1.3290 & 1.3345 to get short. Downside support levels come in at 1.3193 and 1.3100."

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