- Commands to buy the Euro versus the US Dollar in 100-pip range from the spot are bearish (37% long / 63% short)
- The closest resistance for this pair is located at 1.1114
- At the same time, the nearest support is currently placed at 1.1035
- Upcoming events in the next 24 hours: France Trade Balance (May) and Government Budget Balance (May), Eurogroup Meeting, Emergency Euro Summit in Brussels, US Trade Balance (May)
After Greeks supported Alexis Tsipras' government by saying "no" to more austerity in exchange for a new round of bailout funding from its international creditors, Yanis Varoufakis, Greek Finance Minister, unexpectedly announced his resignation. Euclid Tsakalotos is taking over from his notorious and controversial predecessor. Meanwhile, the ECB said that it would keep its Emergency Liquidity Assistance to Greece unchanged at levels announced last Monday. Thus, Greek banks will continue to remain close thought out this week and might resume to work at the end of the week, at best. Greek Prime Minister Alexis Tsipras has hours to prepare a plan to keep his country in the Euro zone, as European leaders meet later in the day in Brussels for another round of talks.
Separately, German factory orders dropped in May as orders from other Euro zone countries fell following a large gain in the preceding month. Industrial orders in the Euro bloc's number one economy decreased a seasonally adjusted 0.2% in the reported month, whereas analysts had expected a 0.4% decline. In the preceding month, the measure gained a revised 2.2%. Measured on an annual basis, orders surged 4.7%.
European leaders to discuss Greece, US trade balance data due today
Presidents and Prime-Ministers of the Euro zone countries will gather together at the Emergency Summit in Brussels today, in order to discuss the most recent developments in Greece, including the referendum and next steps to prevent the Grexit. Before that, Finance Ministers of the Euro zone countries will meet together as well, to give their assessment of the situation. Meanwhile, US trade balance data will be released today at 12:30 PM GMT, as the exports-imports shortfall is expected to widen down to $42.5 billion in May from $40.9 billion a month earlier.EUR/USD likely to lose value, trading range to narrow down
Judging from EUR/USD's developments that took place since May of the previous year, the pair is clearly trading downwards on a long-term chart. At the same time, it seems that now the pair is being bounded between the 2014 low and long-term downtrend line, meaning that it is currently hovering inside the descending triangle pattern. Moreover, this pattern implies a narrowing trading range, while the break-out point can be reached by the end of September. In the medium-term the common European currency may show spikes as high as 200-day SMA and 2005 low at 1.16, but the downtrend will remain the main resistance and should be capable of pushing the cross back in the direction of 1.05-1.10 area in the long run.Daily chart
EUR/USD's outlook tends to remain moderately bearish at the moment, despite attempts of the pair's to rebound yesterday. The Euro is under intense pressure amid the crisis in Greece, as any negative impetus is likely to send the pair substantially downwards. The immediate resistance is represented by the weekly pivot point at 1.1114, followed by a dense supply zone at 1.1156. Meanwhile, the closest support is located at the current trading level of 1.1035 (100-day SMA), but losses can in fact be allowed down to recent lows at 1.0954.
Hourly chart
EUR/USD sentiment deteriorates, pending orders remain bearish
Meanwhile, the portion of pending orders to buy the Euro against the US Dollar in 100-pip range from the spot price have rebounded just one percentage point during the past 24 hours, by climbing to 37%.
It proclaims that in case the EUR/USD rises in value, the pair's near-term gains can be capped by the 55-day SMA, currently at 1.1155. On the other hand, a downward development of the Euro is likely to be extended down to the recent low around 1.0960.
Spreads (avg,pip) / Trading volume / Volatility
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Jun 7 and Jul 7 expect, on average, to see the currency pair around 1.12 by the end of October. Though the majority of participants, namely 51% of them, believe the exchange rate will trade below this level in ninety days, with 35% alone seeing it below 1.08. Alongside, 21% of those surveyed reckon the price will trade in the range between 1.12 and 1.18 by the end of October of this year.