EUR/USD NEARS MAIN SUPPORT AREA AFTER US GDP SURPRISE

Revised US GDP figures turned out to be a lot more bullish than analysts had expected. The economy grew at an annualized rate of 3.7% in the second quarter, much stronger than the 3.2% rate markets were expecting, instead of the originally estimated 2.3%. Thus, GDP is now estimated to have grown by an average 2.15% during the first half of the year, even after the dismal 0.6% first quarter expansion, which is on par with the post-recession trend.

The market reaction was straightforward: dollar was boosted against major counterparts. EUR/USD slid below 1.1250 and is now heading for the main support cluster 1.1155-1.1200. The test of this zone will determine the prevailing trend in this pair. Listed below are links to GBP/USD and EUR/JPY ideas.