12 Jul 2015
EUR/USD breaks below 1.11, Greece drama worsens
FXStreet (Bali) - EUR/USD is under pressure during interbank trade, presently breaking below the 1.11 round number, as Eurozone toughens its hard-line stance against Greece, demanding more austerity measures in the debt-stricken country or else, a temporary Grexit has been offered.
Greece between a rock and a hard place
If Greek Prime Minister Alexis Tsipras were to accept these stricter set of reforms (it would go against his ideology and electoral promises), Reuters reports that he "is set to begin a bruising week by clearing out party rebels opposed to an austerity package that will have to go through parliament within days, people close to the government say."
"Greece will have to pass laws by Wednesday night to cut spending, toughen value added tax, overhaul pension systems, change bankruptcy rules and advance privatisations", Reuters adds.
EUR/USD technicals: Throw them out of the window
As blunt as the headline sounds, EUR/USD performance will continue to be dominated on a headline-by-headline basis. An agreement by Greek PM Tsipras to accept tougher measures in exchange to open up the possibility of a third bailout package, would be seen as a 'risk-on' profile event, likely to help the European shared currency pare some of its early losses. On the contrary, should negotiation break loose and preparations for a Grexit follow, expect an imminent Euro fallout, with 1.1050, 1.10 big round number, 1.0950, 1.0915 (last week's low) and 1.09 the key downside points of reference.
Greece between a rock and a hard place
If Greek Prime Minister Alexis Tsipras were to accept these stricter set of reforms (it would go against his ideology and electoral promises), Reuters reports that he "is set to begin a bruising week by clearing out party rebels opposed to an austerity package that will have to go through parliament within days, people close to the government say."
"Greece will have to pass laws by Wednesday night to cut spending, toughen value added tax, overhaul pension systems, change bankruptcy rules and advance privatisations", Reuters adds.
EUR/USD technicals: Throw them out of the window
As blunt as the headline sounds, EUR/USD performance will continue to be dominated on a headline-by-headline basis. An agreement by Greek PM Tsipras to accept tougher measures in exchange to open up the possibility of a third bailout package, would be seen as a 'risk-on' profile event, likely to help the European shared currency pare some of its early losses. On the contrary, should negotiation break loose and preparations for a Grexit follow, expect an imminent Euro fallout, with 1.1050, 1.10 big round number, 1.0950, 1.0915 (last week's low) and 1.09 the key downside points of reference.