Forex: EUR/USD extends rally above 1.3350 on US trade deficit (Barcelona) - From 1.3265, the EUR/USD took off ahead of the US trade balance report and jumped above the 1.3300 psychological level over a wider trade deficit, from $-42.06B to $-48.73B in November, instead of narrowing to $-41.30B as expected by market consensus. After a quick profit taking period at 1.3350, the EUR/USD extended gains higher, to 1.3365 high.

Annualized US import prices remained unchanged at 1.5% in December, while export prices rose from 0.7% to 1.1%. Philadelphia Fed’s Plosser will speak shortly.

“Current corrective pattern should be limited above 1.3175 support, before next leg upwards, toward 1.3490 area”, wrote analyst Stoyan Mihaylov, pointing to minor intraday support at 1.3250 and 1.3130 crucial on the downside.