BY Alex Gurr
With the markets focusing on today’s Eurozone finance ministers’ meeting, Greece is likely to continue dominating the headlines. This was the case yesterday, with the markets reacting positively to the reports that Angela Merkel wants to keep Greece in the Eurozone. This also resulted in the EURUSD advancing back towards recent resistance around 1.0840.
There is a lot of speculation that a Greece deal will be reached later today, and I view this as a strong possibility given the recent headlines. However, the real question is going to be whether anything fundamentally changes in regards to the Greece situation – or whether this will just lead to a further extension, and another case of kicking the can further down the road for the benefit of political gain.
When looking at the charts, the EURUSD has recently found resistance around the 1.0840 level and if it does manage to surpass this, the upper level to its recent two-month trading range can be found just above 1.10. Upside gains for the EURUSD are still limited to USD weakness to be honest, and traders could be looking to punish any upside momentum as they have done in the past.
The price of WTI Oil has jumped strongly on the back of USD weakness in the market. As a result of the dollar softness, we have tested the $58 area once again and recorded a new yearly high at $58.36. This has been a strong rally, although I expect further USD softness to be required for the price of WTI to reach new highs around the $60 level.
However, I remain concerned about the oversupply anxieties dragging on market sentiment. If this issue inspires traders to take profit, then we are probably looking at the $55 area as support. For now, the current investor sentiment is playing off the strengths and weaknesses of the USD in short term trading.
Gold has stayed true to its technical trend line on the charts, while also benefiting from a weaker USD inspiring a Gold rally. It has to be said that the $1185 support held firm, which resulted in the bulls looking to recover previous losses. Although increased optimism that a Greece deal could be reached encouraged some risk appetite from traders, this did not pass onto Gold and the safe haven still managed to rise higher. Where might the metal trade today? This could be dependent on any news outflow over the Greece situation, while the metal could also appreciate higher if the Durable Goods data from the United States pushes back interest rate expectations.
The FTSE is looking ever more interesting on the charts as it plays off the news flowing across the channel. Currently we are seeing a mixed message on the next path for the FTSE and it’s probably consolidating before the next move. While a potential Greece deal could signal optimism in the market, the FTSE has failed to sustain its recent highs and could still be at risk to further declines if investor sentiment is weighed down by the fast approaching UK election.
Gurr is market analyst at FXTM
For more information please visit: Forex Time
This website uses cookies.