13 Jul 2015
EUR/USD techs: Downward potential as Grexit nears - FXStreet
FXStreet (Bali) - After this weekend's fluid Greek bailout talks, in which a 72-hour deadline was given before an official Grexit materializes, Valeria Bednarik, Chief Analyst at FXStreet, notes that EUR/USD downside potential should extend below 1.1050, potentially targeting a more ambitious bear move towards 1.0950/60 region.
Key Quotes
"The market was overly optimistic last Friday, as a European Finance Ministers meeting on Saturday, and another meeting with EU leaders on Sunday, were supposed to put an end to the Greek crisis, by accepting latest Athens proposals, pretty much what the creditors offered back in June."
"With Tsipras defeated, financial markets discounted the creditors will agree on a third bailout program, but the weekend negotiation were a clear proof that the Union is more willing to let Greece go than to offer a new deal."
"The weekend summits ended with a new 72 hours deadline for Greece, as Tsipras will need now the Parliament to approve austerity measures, and enact economic reforms before opening detailed negotiations on an aid package."
"Technically, the EUR/USD once again opened the week with a bearish gap, albeit not as outrageous as the ones seen on previous weeks, with the pair hovering around 1.1100. The 4 hours chart shows that the price managed to hold anyway above a bullish 20 SMA, currently around 1.1070, whilst the technical indicators have turned sharply lower from overbought territory, but hold above their mid-lines."
"Should the price extend below 1.1050, a strong static support level, the downward potential with increase, pointing then for a decline towards the 1.0950/60 region."
Key Quotes
"The market was overly optimistic last Friday, as a European Finance Ministers meeting on Saturday, and another meeting with EU leaders on Sunday, were supposed to put an end to the Greek crisis, by accepting latest Athens proposals, pretty much what the creditors offered back in June."
"With Tsipras defeated, financial markets discounted the creditors will agree on a third bailout program, but the weekend negotiation were a clear proof that the Union is more willing to let Greece go than to offer a new deal."
"The weekend summits ended with a new 72 hours deadline for Greece, as Tsipras will need now the Parliament to approve austerity measures, and enact economic reforms before opening detailed negotiations on an aid package."
"Technically, the EUR/USD once again opened the week with a bearish gap, albeit not as outrageous as the ones seen on previous weeks, with the pair hovering around 1.1100. The 4 hours chart shows that the price managed to hold anyway above a bullish 20 SMA, currently around 1.1070, whilst the technical indicators have turned sharply lower from overbought territory, but hold above their mid-lines."
"Should the price extend below 1.1050, a strong static support level, the downward potential with increase, pointing then for a decline towards the 1.0950/60 region."