Forex: The EUR/USD remains around 1.3300; Is the 1.3400 a top? (San Francisco) - After trading at sub-1.3300 levels during almost the whole Wednesday session in the wake of Euro Group leader Juncker's comments saying that the EUR/USD rate was "dangerously high," the euro managed to trim losses from the intra-day low at 1.3250 to close around 1.3290 -- down just 0.15% on the day.

In the fundamental field, reports showed that U.S. consumer prices held steady in December, giving the Federal Reserve room to maintain its expansionary policy. U.S. industrial production grew 0.3% in December, and the Fed's Beige Book published that all the districts in the country have seen modest or moderate economic growth.

Earlier in the session, World Bank officials downgraded growth forecasts for the global economy in 2013. "The announcement is weighing heavily on major currency advancements, particularly the EURUSD," points out analyst Richard Lee.

According to Lee, the downside is still imminent for the EUR/USD. "EUR/USD downside continues to remain intact with a close below 1.3300," he said. "The level will be pivotal, and watched as we head into the afternoon trade. The break of the psychological figure will open scope for a bearish extension towards support at 1.3182."

Up and down, but always close to the 1.3300 level

In a recent report, Chief Analyst Valeria Bednarik affirmed that the EUR/USD is eyeing 1.3180 after setting a top. Bednarik remarked that "the euro is struggling around the 38.2% retracement of its latest bullish run," with the EUR/USD maintaining a heavy stance this Wednesday, "having toped at the 1.3320 area, a 23.6% retracement of the same rally."

But is the euro rising back above 1.3300? Is 1.3400 a top? In this line, A. Lohman Rasmussen, Chief Analyst at Danske Bank, pointed out that despite Juncker's words, the bloc currency is back to the 1.3300 region.

"However, we doubt his comments will have any lasting effect on the euro as long as the ECB is not ready to accommodate any attempt to weaken the euro," affirms Rasmussen. "ECB has already said that a new rate cut is not an option and there is close to no chance that the ECB will engage in quantitative easing policies for the foreseeable future. Hence, in an environment characterized by an improvement in the cyclical outlook and strong risk sentiment we still see EUR/USD crawling higher over the next three to six months."

As for the short term, EUR/USD would need to regain the 1.3320 area (intraday highs) to turned focus back to the upside, with 1.3400 as the next target ahead of the 1.3485 big figure (2012 high). On the other hand, loss of the 1.3250 area would increase the short-term pressure, targeting the 1.3200 mark. The longer-term view, however, remains positive, even though daily indicators begin to lose momentum.

Thursday's calendar in the euro area will not offer anything much different from today's. The docket will kick in with the ECB Monthly Report, followed by key 10-year bond auctions in Spain and France. The EMU's Construction Output will close the day.

In the U.S., investors must pay attention to the weekly report on the U.S. labor market, Housing Starts and permits and the Philly Fed manufacturing survey.

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