Talking Forex: EUR/USD Looking To Reclaim 1.3079 Level

EUR/USD
Technically, EUR/USD is looking to reclaim 1.3079 level, the mid-point of the latest sell-off, which once broken to the upside opens up 1.3202, last week's high. Above, there is a strong resistance at 1.3228 which is the mid-point of the February to April decline. ECB's Asmussen said that the pass-through of lower interest rates to periphery would be limited due to impaired monetary policy transmission, while Germany's Merkel said that the ECB would have to raise rates if looking at Germany only. In other news, Moody's said it remains concerned about Spain's repeated upward revisions to budget deficit outcomes, which damage the government's fiscal credibility. While, according to the senior director of Fitch Rating's European sovereign credit analysis, ECB still has more firepower it can deploy.
GBP/USD
GBP/USD traded sharply higher on Thursday, supported by the release of much better than expected advanced GDP reading. The move higher saw the pair reclaim the 38% retracement of the January to March sell-off at 1.5424 which now opens up the door towards 1.5550. The release of the advanced GDP report from the UK surprised to the upside, supported by the bounce back in the North Sea oil output. Even though some analysts had predicted the unseasonably cold weather in March would reduce consumer spending, the ONS said that snow and cold weather had little overall impact in Q1 and that the UK GDP is now 2.6% lower than all-time peak in Q1 2008.
USD/JPY
USD/JPY edged lower on Thursday, as profit taking and option decay related flows weighed on the pair. Technically, the pair remains on track to make a test on the elusive 100.00 level, which once broken would indicate an extension towards the April 2009 high at 101.45. Japanese PM Abe said it is not necessary to stick to JPY 44trl bond issuance cap and added that the government will strive for fiscal stability over the medium term.