EUR/USD Daily: Consolidating above Ichimoku Cloud
Mr. Euro is back in town! The single currency of the Euro zone is once again in focus as Greece made a last-ditch offer to its creditors in a desperate effort to avoid defaulting on its debt.
The European powers political gangs have once again called for closer political, monetary and economic ties between all the 19 countries in the Euro zone; including Greece.
Upon London Market open Forex Divas (and Forex Divos) were cheering Mr. Euro up on the forex dance floor as they were hopeful to cool results out of the EU, as the President of the European Commission, Jean-Claude Juncker said they are working on a plan that could help prevent future economic crises.
“The euro is more than just a currency. It is a political and economic project…This common destiny requires solidarity in times of crisis and respect for commonly agreed rules from all members.” the report published late on Sunday noted.
Reports suggest that the Greeks are doing their homework ahead of today’s European summit. Following a call between Tsipras, Merkel and Hollande yesterday, Greek negotiators were talking with institutions into the early hours of this morning.
What we think we’re going to get is a six month extension based on agreed reforms from Greece. Greek finance minister Varoufakis has said that ‘We are prepared to compromise, but we are not prepared to do what previous governments have done, take on new debt with conditions that leave little hope’.
A six month extension would see the settlement of the current extension, giving Greece the resources to pay the IMF by the end of the month and then €11bn in disbursements over the next six months, probably contingent on measurable action being taken in Greece – which also sounds a bit like a can being kicked down a very expensive road! One person close to Alex Tsipras has expressed his desire for the IMF not to be involved in the next deal, saying the IMF has “an agenda which is not at all European”, and the Washington based institution has “no place in Europe”.
US monthly Existing Home Sales are scheduled to be out at 10 AM EST. A better than the expected $5.27 M release would push Ms. USA higher which in turn, could push the EUR/USD lower on the forex dance floor.
If you have already entered a bullish position based on my previous report at the 23% Fibonacci level, you might consider remaining in your position and exit at 1.1527 and our extended target of 38% Fibonacci at 1.17.
Alternative Scenario:Below 1.08 look for further drops towards 1.0470 and parity.
Where I’m setting my stops and limits:
|Support Levels||Turning Point||Resistance Levels|
*Important Note: The support and resistance levels are not suitable for all traders and largely depend on your account size, margin and leverage. Book a private lesson to learn how to personalize your account based on our trading guide.