We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bearish
Gold
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bullish
USD/JPY
Bullish
More View more
Real Time News
  • #Gold Price Technical Outlook: $XAUUSD Soars to Nine-Year Highs - https://t.co/NS6YfghqIg https://t.co/WUqbvANriw
  • Heads Up:🇺🇸 Fed Bostic Speech due at 16:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-07-09
  • RT @TheStalwart: Starting to look clear that where cases are surging, deaths are starting to go up. Here's the 7-day moving average of both…
  • US 8-Week Bills Draw 0.100% Primary Dealers Awarded: 68.4% Indirect Bidders Accepted: 26.7% Direct Bidders Accepted: 4.9% B/C Ratio: 2.96
  • $Gold snap back, testing support around prior res 1796-1800. prior eight-year-high up to the 1800 psych level https://t.co/LPyHLlQpk8 https://t.co/lEkGvK14kK
  • Arizona virus cases increase 3.7%, in line with prior 7-day average - BBG
  • Hey traders! Market risk appetite is highly concentrated. What are some other market highlights for today? Find out from @DailyFX Chief Strategist @JohnKicklighter 👇 https://t.co/YvQTLDBK7p
  • Update on #Cryptocurrencies #BITCOIN -1.27% #BITCOINCASH -2.20% #ETHEREUM -1.62% #RIPPLE +1.59% #LITECOIN -1.11%
  • $EURUSD continuing to catch resistance from the 1292 level, working on its sixth consecutive week. This week has, so far, brought on a higher-high, but can bulls continue to drive? $USD breakdown potential the key for whether or not EUR/USD can push up for a re-test 1500 https://t.co/6MeQmEpluO
  • Hey traders! Market risk appetite is highly concentrated. What are some other market highlights for today? Find out 👇 https://t.co/ebfF9W6nCU
Euro Traders’ Patience Running Thin for Broken Greek Promises

Euro Traders’ Patience Running Thin for Broken Greek Promises

2012-02-11 06:19:00
John Kicklighter, Chief Strategist
Share:
Euro_Traders_Patience_Running_Thin_for_Broken_Greek_Promises_body_Picture_5.png, Euro Traders’ Patience Running Thin for Broken Greek PromisesEuro_Traders_Patience_Running_Thin_for_Broken_Greek_Promises_body_Picture_6.png, Euro Traders’ Patience Running Thin for Broken Greek Promises

Fundamental Forecast for the Euro: Bearish

How long can we string this out? That is how we need to look at the euro’s fundamental health. The Greek crisis (it’s fair to refer to the situation as such considering officials are using ultimatums that ‘there is no other option’ or ‘the alternative is an exit from the euro’) is now in its 23rd month, and the outlook continues to deteriorate. There are two levels on which we need to establish our bearing with the shared currency going forward: how does the situation play out over the coming, critical week; and will there be a greater appreciation for the long-term troubles that lie before us?

The past week’s fundamental back-and-forth was a fiasco. Financial headlines splashed broken deadlines, Greece struggled to push through the terms of its next austerity drive and the EU shot the effort down. For a market that has traded off with reacting on all perceived bearish news (while ignoring any positive updates) and then focusing only on the bullish (with no mind paid to worrisome developments) over the past months, the wild oscillations in the outlook for Greece and the Euro Zone were simple too much. At this point, the market has so become saturated with news, that it seems speculators are reserving their judgment for genuine developments. As such, we may find the market is especially critical of the progress (or lack thereof) that is made in the Greek saga through the coming week.

Taking stock of a complicated situation, there is a relatively simple progression that we can follow moving forward. The first step this weekend requires the Greek Parliament to approve the terms of the austerity proposal that the Cabinet approved after the close of trading on Friday. The plan presented last week was rejected by EU minister as it supposedly required another 325 million euros in spending cuts (in additional to the reported 3.3 billion in the draft), sweeping budget reform sanctioned by Parliament and assurances that policy would endure the April elections. Finance Minister Venizelos has framed the vote as a decision on whether the country will remain with the euro. While this may be posturing to encourage compliance – it also sets a tone of ‘no alternative’ to traders.

Should Parliament approve the proposal, we will move on to the consent to the private investor haircuts on their Greek debt holdings. The current terms are for a more-than 70 percent write down, a swap for 30-year bonds yielding 3.6 percent along with growth and EFSF bond sweetners. If that step is checked off, then the EU ministers will decide whether it is confident in Greece’s ability to rein its debt level in to the targeted 120 percent of GDP. If so, the 130 billion euro package (promised last year) can be released. Should any of these steps fail; the aid will not be given. And, we are moving too far along to keep simply moving back deadlines. It was Venizelos himself who said February 15th was the critical point for receiving the second bailout to reasonably make the March 20 bond repayment of 14.5 billion euros.

All of the above is the immediate concern. Clearly, if this schedule falls apart; the market will be solely occupied with its disastrous implications. However, we should also keep the longer-term issues into perspective. With additional Greek austerity, the forecasted return to growth in 2013 seems ludicrous. The weight of austerity and recession could still very likely swamp the country in the end. Furthermore, the risk is not isolated to Greece alone. Portugal looks like it won’t be able to return to the market in 2013 with its yields at current levels, there is talk that Ireland may demand accommodation like Greece and the general region is heading towards recession.

Speaking of recession, we will be reminded of the steady slide into economic contraction the Euro Zone is heading into with 4Q GDP figures scheduled for release. Germany, Italian and French numbers are important; but I will be watch Portugal and Spain more closely. – JK

--- Written by: John Kicklighter, Senior Currency Strategist for DailyFX.com

To contact John, email jkicklighter@dailyfx.com. Follow me on twitter at http://www.twitter.com/JohnKicklighter

To be added to John’s email distribution list, send an email with the subject line “Distribution List” to jkicklighter@dailyfx.com.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.