The European common currency strengthened against majors after Spain and Ireland announced that they sold long-term bonds which lowered concerns after the weak bond sell by Italy last weekwhich renewed debt concerns in the region.

The downbeat German zew survey economic situation for August was dwarfed by the sharp climb in current situation and improvement in euro zone's similar report.

The euro-dollar pair advanced to a high of 1.2915 but retreated from there to 1.2861. The euro is doing upside correction to last week's drop. Momentum indicators are showing that the pair is rebounding from an oversold area on the daily charts.

For the rest of the day, the pair is expected to swing between support and resistance at 1.2730 and 1.2880 respectively.

Turning to the sterling-dollar pair, it reversed its earlier gains as it fell from a high of 1.5694 to 1.5621, where it is currently trading. However, the pair is currently moving in an oversold area which refers to the possibility of moving to the upside.

Today, data from UK showed that CPI fell in July to 3.1%, yet it remains above the 3% upper limit which prompted the governor of the BoE to send a letter to the Chancellor of the Exchequer to explain why the rate is still above the target.

The royal pair touched a low of 1.5606, while it is expected to move between support at 1.5560 and resistance at 1.5650 for the rest of the day.

With regard to the dollar-yen pair, it retreated earlier to a low of 85.09 with the advance of Asian shares but currently it is trading near the opening price ahead of the release of important U.S. data. So far, the pair is trading at 85.29, reporting a high of 85.52, whereas support is seen at 84.70 while resistance is at 86.20.