FXStreet (Edinburgh) – The shared currency clinched its second weekly gain in a row vs. the US dollar in spite of being rejected once again from the tough resistance band at 1.1380/1.1400 (Wednesday). Developments from Greece and a solid performance of German yields have been propping up the upside throughout the week.
Greece, always Greece
Greece remained the almost exclusive catalyst for the pair’s price action this week, with a deterioration of the debt talks going in crescendo since Monday until Friday afternoon: when everything was pointing to a default in the country and even the ‘Grexit’ spectre was looming, Greek officials caught markets off-guard and announced a new set of proposals to be submitted over the weekend.
Let’s assume for a second that Greece submits this new list. In that scenario, and all being approved and ok’ed by EU officials, a meeting to seal the deal will follow, probably on Sunday or Monday, between Greece, the ECB and the IMF. Far too good to be true.
Monday then could well see euphoric markets and the EUR/USD reclaiming further ground, initially targeting recent peaks near 1.1400 the figure. On the (most likely) opposite side, market participants will see themselves once again deceived by Tsipras and his colleagues, their pessimism ten-folded, and the selling pressure dragging spot lower, with the first stop being this week’s lows around the mid-1.1100s.
(Market News Provided by FXstreet)