EUR/USD: Drop in Greek 10-year yield to 13-year lows fails to put a bid under EUR, eyes on German ZEW

  • EUR created a doji candle yesterday, establishing the area above 1.1320 as the level to beat for the bulls. 
  • The shared currency is struggling to pick up a bid despite tighter Greek-German 10-year government bond yield spread. The Greek 10-year bond yield fell to a 13-year low yesterday. 
  • A better-than-expected German Zew survey, due at 09:00 GMT, could yield a sustained move above 1.1320. 

The shared currency's struggle for a convincing move above 1.13 continues for the third day despite the drop in the Greek 10-year bond
yield and tighter Greek-German bond yield spread.  

Greek government bond yields fell to near record low levels yesterday in response to comments by a senior official that a deal to repay
International Monetary Fund loan is imminent. 

Notably, the 10-year yield fell to slipped to 3.29 percent, its lowest since September 2005 and the spread with the German counterpart
narrowed to 232 basis points - the lowest since February 2018. 

The tightening of Greek-German yield spread is known to put a bid under the common currency. This time, however, the narrowing of
Greek-German yield spread has failed to lift the shared currency. In fact, the pair created a doji candle yesterday with a long
upper wick yesterday, establishing Friday's high of 1.1324 as the level to beat for the bulls. 

A close above 1.1324 would invalidate the doji candle and signal a continuation of the rally from the recent low of 1.1184. That looks likely in case the German Zew surveys beat expectations by a big margin, alleviating concerns of a deeper economic slowdown in the Eurozone's biggest economy. The bullish case may strengthen if the Greek 10-year yield hits record low below 3.203 percent. 

On the other hand, a close below 1.1298 (doji's low) would imply an end of the bounce from the lows near 1.1180. A weaker-than-expected German Zew data could push the common currency well below 1.1298. 

Technical Levels

EUR/USD

Overview
Today last price 1.1303
Today Daily Change -0.0001
Today Daily Change % -0.01
Today daily open 1.1304
 
Trends
Daily SMA20 1.1273
Daily SMA50 1.1302
Daily SMA100 1.135
Daily SMA200 1.1447
Levels
Previous Daily High 1.1322
Previous Daily Low 1.1298
Previous Weekly High 1.1326
Previous Weekly Low 1.1213
Previous Monthly High 1.1448
Previous Monthly Low 1.1176
Daily Fibonacci 38.2% 1.1307
Daily Fibonacci 61.8% 1.1312
Daily Pivot Point S1 1.1293
Daily Pivot Point S2 1.1284
Daily Pivot Point S3 1.1269
Daily Pivot Point R1 1.1317
Daily Pivot Point R2 1.1331
Daily Pivot Point R3 1.1341

 

 

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