Forex: EUR/USD rallies as EZ leaders cheer decisions (Barcelona) - Now that US business inventories are released, the EUR/USD is attempting at extending its session gains back to the daily high around the 1.3100 mark. As of writing, the pair rallies to 1.3095. The market has fully retraced the European losses, with a low printed at 1.3041.

Although most US data disappointed and business inventories came in line with consensus at 0.4%, investors are watching the Eurozone leaders cheering the accomplishments made in 2012 and the recent approval of the ECB supervisory oversight powers over up to 200 eurozone lenders, as well as the €34.4B tranche to Greece disbursed today. The French President Hollande praised Mario Monti for his role in Italy and the June summit. German Chancellor Merkel and EU's Juncker also came to public applauding the decisions made this week.

In general, the US data came in lower than expected, with PPI (YoY) easing from 2.3% to 1.5% in November (consensus of 1.8%) and Retail Sales (MoM) rising 0.3% in November (consensus of 0.5%).

Commerzbank analysts expect the rebound from the Nov-28 low at 1.2880 to resume and reach the 1.3122 resistance line and the 1.3150/80 major resistance after having already breached the 1.3023 zone. “We look for failure shortly and for a slide back to the 1.2880/76 support”, wrote analyst Karen Jones.