EUR/USD Testing Higher Following Historic Fed Announcement (FXE)

December 12, 2012 1:18 PM EST
The spot price of EUR/USD is testing higher on Wednesday afternoon following an announcement by the Federal Open Market Committee. The Fed plans to continue its plan to buy $40 billion per month in agency mortgage-backed securities and ended operation twist, opting for $45 billion in outright purchases in its place. The Fed also linked its historic quantitative easing measures directly to employment and inflation, with targets of 6.5 percent and below 2.5 percent, respectively.

Euro bulls noted strong resistance clustered around 1.3150 to 1.3200, but a breach of this level could see prices take a leg high toward 1.3400, as momentum appears strong, say traders.

The USD is also seeing gains against the Yen, GBP, CHF, and a number of other currencies, including AUD, and CAD.

EUR/USD trades at 1.309.

CurrencyShares Euro Trust (NYSE: FXE), an ETF tied to EUR/USD is higher by 0.7 percent mid-day on Wednesday.

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