Euro falls as short-covering rally loses steam

The euro fell against the dollar for a second straight session on Thursday as traders booked profits on recent gains, but losses were limited by hopes of European Central Bank action to ease the pressure on debt-stricken Spain and Italy.

The euro zone common currency has staged a rebound since hitting a more-than-two-year low of $1.2040 late last month after ECB President Mario Draghi said the bank would do whatever it takes to save the euro and may purchase bonds to help lower borrowing costs for stressed countries.

But the rally lost steam after the currency failed to rise convincingly above key resistance around $1.2400, the 55-day moving average, prompting traders to lock in gains.

"Euro bears are getting braver every day the short-covering rally fails to make further headway," said Kit Juckes, currency strategist at Societe Generale in London.

Read Full Article from Reuters

- Posted: 2012-08-09 15:54:29

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