FXstreet.com (San Francisco) - The Euro recovery against the US Dollar has been strongly rejected at the 1.3010, Nov high, with the EUR/USD falling fast to 1.2965 on the back of cocktail of developments. Currently the pair is at 1.2980.

First a well above consensus Pending Home Sales in October that spurs fears on QE suspension. Second the Democratic leader Chris Van Holland saying that the two sides are not close to a deal on the fiscal cliff. And third a very well anticipated sell interest just above the 1.3000 mark. This cocktail was used to launch the pair around 45 pips down where the EUR/USD found support.

But according to the Bank of Tokyo-Mitsubishi UFJ's European Head of Global Research Derek Halpenny, the EUR/USD "will continue to be contained by the belief that the Fed will maintain an ultra-loose monetary stance."

In a recent note, Halpenny pointed that "operation twist ends next month but may be replaced by balance sheet expansion while Chicago Fed President Evans today cited an unemployment rate of 6.5% as the level to reach before the Fed considers rate increases."

BTMU expert believes that a "pop higher in EUR/USD over 1.3000 that looks imminent should be taken as a good opportunity to sell" as far as "the downward trend in EUR/USD still intact."