EUR/USD breaks above 1.27 on Greece debt auction

NEW YORK (Forex News Now) – The euro surged against the U.S. dollar on Tuesday, breaking above the 1.27 mark following a successful Greek debt auction and disappointing data on the U.S. trade deficit.

In U.S. afternoon currency trading, EUR/USD hit 1.2738, a 2-month high. The currency pair later retreated slightly to trade at 1.2712, up 0.92 percent on the day.

Greece earlier raised EUR 1.625 billion in its first auction since receiving emergency financing in May, assuaging fears over the debt crisis that has engulfed Europe in recent months.

According to forex analysis, EUR/USD was likely to touch immediate support around the daily low, 1.2423, and encounter resistance around the high of May 5, 1.2996.

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Also Tuesday, official data showed that the U.S. trade deficit widened unexpectedly in May to its highest since November 2008. The Commerce Department said the trade gap climbed to USD 42.3 billion during the month, up nearly 5% from April’s $40.3 billion.

Global forex analysts had expected the deficit to contract slightly to USD 39 billion in May, two major financial news outlets reported.

Meanwhile, the single currency also rose versus the yen: EUR/JPY traded at 112.42, up 0.72 percent on the day.

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