By Fast Brokers – The EUR/USD surged when the markets opened, toppling previous April highs with ease and tapped 1.37 after the EU announced it will provide Greece with roughly $40 billion @ 5% and the IMF will cover the rest. The EU finally caved in to supporting Greece after Greek bonds collapsed last week and yields surged to a record high. Greece is satisfied with the aid pledge thus far, although 5% is a bit above what the government was hoping for. Regardless, the risk trade has received a boost of confidence as Greece fears ease. Additionally, this could be the burst that the EUR/USD needs to shake free from its funk and piece together a nice uptrend, though we will have to see how conditions play out. Meanwhile, the data wire is calm until tomorrow when investors receive U.S. Trade Balance data. Since the EU will be quiet the Euro may continue to outperform unless there is a negative psychological development over the near-term. The story now becomes whether the EUR/USD can sustain its new upward momentum and build a more substantial uptrend.
Technically speaking, despite today’s upswing the EUR/USD faces fresh downtrend lines along with intraday, 3/3, and March highs. As for the downside, the EUR/USD has new uptrend lines serving as technical cushions along with intraday and 3/5 lows. Additionally, the psychological 1.36 and 1.35 levels could serve as technical cushions for the near-term.
Present Price: 1.3589
Resistances: 1.3597, 1.3613, 1.3624, 1.3632, 1.3642, 1.3655
Supports: 1.3586, 1.3577, 1.3563, 1.3551, 1.3540, 1.3531
Psychological: April and March highs, 1.35, 1.36, 1.37
(click chart to enlarge)
Market Commentary provided by Fast Brokers.
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