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Session Recap: Markets reluctant to risk; EUR/USD shy to break 1.3650

FXStreet (San Francisco) - Currency market took a breather on Monday ahead of Yellen's testimony before the US House of Representatives on Tuesday. The US dollar lost ground against its major competitors with the EUR/USD flirting with the 1.3650 and GBP/USD consolidating Friday's gains. Overall, market moved in small ranges.

The EUR/USD posted its fourth positive day in a row but the pair wasn't able to break above 1.3650, tested several times. Adam Button from ForexLive: "EUR/USD was capped by the downtrend from the late December high. In both Asia and US trading, EUR/USD touched 1.3651 but couldn’t climb above. It slipped back to 1.3632 but remains within striking distance of the one-week high."

EUR/USD's hourly chart remains flat, however the 4-hour timeframe shows bullish conditions, "supporting further advances towards 1.3700 for the upcoming session." as FXStreet chief analyst Valeria Bednarik commented in a recent piece.

The GBP/USD traded in consolidation mode following Friday's jump from 1.6300 to 1.6400. The cable moved in between 1.6385 and 1.6420 and it closed at 1.6400. The USD/JPY tested 102.65 resistance and it was launched down to 102.00; however the pair managed to recover ground and it closed at 102.25.

Main headlines in the American session:

Bank of England's forward guidance due for an overhaul

NY Fed consumer expectations survey shows rising incomes, falling inflation expected

Bank of Canada’s Murray repeats that inflation will rise toward 2% in two years

Wall Street advances ahead of Yellen's first speech

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