FXStreet (Buenos Aires) – With interbank trading about to start, there are good chances the weekend developments on Greece will trigger a huge downward gap in the pair, as a Grexit has become real. After Greek PM Tsipras rejected the latest proposal and called for a referendum late Friday, bank runs began: Greek ATM’s run out of cash, the ECB refused to move the ELA ceiling, albeit will keep funding the country up to the ceiling set last Friday.
On Sunday, a Greek bank holiday was announced for Monday (some rumors point it may extend for the whole week) whilst the local exchange market will remain closed also this Monday.
The news are extremely bearish for the EUR/USD pair, and will likely fuel safe-haven demands. The EUR/USD pair closed last week at 1.1165, with big supports at 1.1050 and 1.0960, the levels to watch for some demand should the pair sunk at the opening. Nevertheless, the common currency will likely be in sell-off mode, and can continue falling in Asian hours with some limited upward gains in the middle.
A gap of over 100 pips will unlikely be filled during the first 24 hours of trading, with short-lived upward corrective movement, most likely seen by investors as selling opportunities.
(Market News Provided by FXstreet)