Heavy Euro Selling Pressure as Greece Standoff Continues

U.S. Dollar Trading (USD) the mood soured overnight in the US session and into Wednesday’s Asian session as rhetoric of the Greece far left politicians suggested the recent bailouts may be torn up and Greece forced to exit the Eurozone. The EUR/USD has broken below 1.3000 once again and Gold is falling heavily as USD and cash become king. Looking ahead, FOMC Member Pianalto.

The Euro (EUR) focus has swung back to the Europe and the Greece elections continuing to have negative effects on the market. The Greece political stalemate is unlikely to end shortly and the uncertainty will likely lead to more selling. Major support is seen at 1.2950 and we are poised to test this level this session. The Sterling (GBP) The GBP/USD was sold down to the 1.6125 on the risk aversion but EUR/GBP selling is supporting and the downside is seen as limited compared to other risk sensitive majors. Looking ahead, March Trade Balance forecast 13.5bn vs. 13.6bn previously.

The Japanese Yen (JPY) risk aversion made the safe haven in the Yen the strongest currency in the market back under Y80 on the major and the crosses punching lower led by the EUR/JPY. AUD/JPY is another closely watched risk trade and is close to the key Y80 level. Australian Dollar (AUD) the AUD/USD is being sold aggressively in the last 24 hours with the stock markets and the Greece debacle giving traders the green light. The RBA rate cuts is likely to see the AUD/USD test 1.000 and we could see this as soon as today given the heavy sales in Asia.

Oil & Gold (XAU) the XAU/USD is being liquidated as investors flee to cash while the uncertainty remains. The precious metal is below $1600 and heading lower in the Asian session. Oil resumed the heavy selling seen on Friday and we are retesting $97 a barrel.

 

Pairs to watch

EUR/USD Greece to leave Eurozone?

AUD/USD To test Parity?

 

TECHNICAL COMMENTARY

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