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Trading Outlook – EUR/USD

Jarratt Davis
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Originally updated: 06:55

Trading Bias: SHORT

Currency pair: EUR/USD

Current Sentiment: Bullish

In today’s trading session we will be focussing on selling opportunities on the EUR/USD.

Fundamentals:

All focus turns to Greece today as Finance ministers from EU member states meet to discuss the continuing Greek debt crisis – Greek PM Tsipras has recently stated leading into the event that he is not prepared to negotiate a bailout extension which would mean further austerity and is alternatively seeking to reach a loan agreement with the EU.

Expect short term volatility throughout the session as market sentiment will fluctuate to and fro from EUR positive to negative as sources from within the conference share their opinions on Grexit throughout the session.

Bearing in mind that the EUR (despite any relief rallies caused by a semblance of accord shared with Greece or as we have seen recently artificial strength on the currency as the SNB props up the EUR on the EURCHF pair) is fundamentally heading down with the first stage of QE beginning next month, therefore any notable rallies can be viewed as opportunities to get into the market and sell the currency supported by popular analyst consensus that EURUSD will hit parity over the coming months.

Technicals:

Our bias is that this will sell off during today’s session.

There is strong resistance at 1.1375 which could provide trading opportunities should the price pull back. Look for the price to bounce off this level if it retraces back to it.

Remember to be aware of intra-day news as this can very often change the sentiment which makes our trade weaker. Look for any news that could be positive for this pair, which would change the sentiment to bullish.

Other Market Moving News:

The Antipodean currencies fared well in the overnight session following stronger than expected consumer confidence and housing data for the AUD whilst the NZD underpinned by its relatively attractive yield took strength from Gov Wheeler’s comments last week that rate cuts are not being entertained – this of course influencing speculative positioning.

At the close of Yesterdays European session we had the Bank of Canada state that they are prepared to cut rates again. Therefore we see potential for further CAD weakness throughout the session obviously in conjunction with Oil strength as a gauge on the CAD – with the CAD being a commodity linked currency.

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