By Fast Brokers – The EUR/USD is balancing above 1.35 as investors await U.S. New Home Sales data along with Bernanke’s testimony before Congress. It will be interesting to see what kind of impact the New Home Sales number has on the risk trade. With the EU still mired in fiscal worries strong home sales data could lead investors to the Dollar due to the comparative strength of the U.S. economy. However, should home sales print weak it remains to be seen whether investors would run to the Dollar in safety or continue to stabilize the EUR/USD due to weakness in both economies. 
The EU did have a bit of good news today with Industrial New Orders printing much stronger than expected while the previous release was revised higher. Hence, it appears a weaker Euro is spurring demand for EU goods, boosting manufacturing influenced data such as today. This could explain the upward momentum in the EUR/GBP right now. As for Bernanke, should he by chance imply that the Fed is tightening its stance more than anticipated this could lead investors to the Greenback once again. On the other hand, should Bernanke commit to loose liquidity for the foreseeable future the risk trade may stabilize. Meanwhile, although gold registered a large bar down during the Asia trading session, the precious metal is stabilizing just below its highly psychological $1100/oz level. That being said, investors should monitor activity in gold for a significant technical setback could lead investors to the Dollar due to their usual negative correlation. Although the EU will release German Unemployment Change and M3 data tomorrow, attention will likely remain focused on the U.S. with the continuation of Bernanke’s testimony along with U.S. Core Durable Goods Orders and weekly Unemployment Claims. On the other hand, more positive EU data could be a welcome development for the Euro and provide further stability considering the behavior we’ve witnessed in reaction to today’s Industrial New Orders number.
Technically speaking, the EUR/USD faces multiple downtrend lines along with 2/18, 2/22, and 2/23 highs. As for the downside, the EUR/USD has several uptrend lines serving as technical cushions along with intraday, 2/23 and 2/18 lows. Furthermore, the psychological 1.35 area could continue to serve as a technical cushion should it be retested.
Present Price: 1.3545
Resistances: 1.3572, 1.3592, 1.3612, 1.3632, 1.3652, 1.3679
Supports: 1.3542, 1.3526, 1.3511, 1.3493, 1.3473, 1.3453
Psychological: February lows, 1.35
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