Richard Perry
Independent Analyst
The immediate reaction following on from the weekend’s developments over Greece has been for the euro to be sold hard at the open. The 100 pip gap lower has left resistance at $1.1130 and although normally the feeling is that gaps will be filled, today there is sizeable doubt that this will happen. This fundamentally driven sell-off leaves technicals very much playing second fiddle, however there has been a significant deterioration in the technical outlook. The decline back below $1.1050 is a key move and if there is a close below there tonight the chart will be in negative configuration as $1.1050 has been a key pivot level in the medium term. The momentum indicators have taken a sharp dip (not to be unexpected) and whilst the situation (and the price) remains volatile it is difficult to give an outlook of any conviction. A retest of the overnight low at $1.0953 could easily be seen amid the volatility. There is now resistance $1.1130/$1.1165. It could be a while before this one settles down so expect high volatility to continue for the time being.
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