- Share of long pending orders in 100-pip range declined below 50%
- Market sentiment remains slightly bearish (53%) for a fifth consecutive day
- Bulls to attempt retaking Jun/May highs around 1.1450
- 20-day SMA and 50% retracement are creating the closest support for the pair
- Economic events to watch in the next 24 hours: German Bundesbank Monthly Report; US Existing Home Sales (Aug); FOMC Member Lockhart Speaks
A month after he resigned from the post of prime minister, Greek leftist Alexis Tsipras declared an unexpectedly decisive victory in Greece's snap elections. With 60% of votes counted, Tsipras' Syriza party is estimated to be just short of a majority with 35.5% of the vote, but the Independent Greeks agreed to join a coalition. Together, the parties would have enough seats to ensure a majority in parliament. The snap election was called after Syriza lost its majority in August. This followed the signing of an unpopular new financial bailout deal with Greece's international creditors.
In a victory speech, Tsipras pledged a new phase of stability, saying his mandate would now see him through a full term, after the country held five general elections in six years. Tsipras made no specific reference to the 85 billion euros bailout, albeit Syriza promised to implement it, while pledging to introduce measures to protect vulnerable groups. Jeroen Dijsselbloem, the head of the Eurogroup, said he looked forward to the immediate formation of a new Greek government with a mandate to implement the bailout.
Meanwhile, the Euro zone's current account recorded a dip in its surplus in July, just after an abrupt increase in the prior month. The current account surplus declined to 22.6 billion euros in July from June's 24.9 billion euros.
Upcoming fundamentals: Fed's Lockhart to speak on Monday
After a series of speeches among the FOMC members on Friday and Saturday, today one more voting member, namely President of the Federal Reserve Bank of Atlanta Dennis Lockhart, is going to present his view on the monetary policy of the regulator. He remained in the camp of FOMC members who voted to leave rates unchanged on Thursday. However, earlier in August Lockhart noted that he sees a hike to take place this year. He is due to speak on Monday at 17:00 GMT at Buckhead Rotary Club in Atlanta.
EUR/USD erases earlier gains, comes back to 1.13
EUR/USD failed to extend gains on Friday and failed at the May high of 1.1466. This event turned attention to the downside and the pair was sold-off down to 1.13. Bears are looking at 20-day SMA and 50% Fibonacci retracement of Jul-Aug uptrend at 1.1270/61. A failure of bulls to gain momentum from there should rule out a revival in the near term and bears are likely to aim at the next demand area placed at 1.1154/26. Aggregate daily indicators are, however, pointing upwards at the moment.Daily chart
As the one-hour chart shows, EUR/USD initially attempted to cap losses around 38.2% retracement on Friday, but the only reliable support was offered by 200-hour SMA, currently at 1.1290. This fact may support bullish case in the very short term, but overall losses are at risk of being extended in the foreseeable future.
Hourly chart
SWFX sentiment flat since last Tuesday
Meanwhile, the total number of bullish positions at OANDA amounts to 44.53% at the moment, while SAXO Bank traders are even more pessimistic with respect to the common currency as their portion of the longs takes up only 36% of all open trades.