EUR Trading Outlook (11-02-2015)

EUR/USD NY walked in with bear pressure being applied to the pair. Europe dropped EUR/USD from the 1.1335 area towards 1.1275 into NY’s open mostly on the back of EUR/GBP’s decline to 0.7409. Real money bids in EUR/USD stemmed the slide and an MNI story on Greece then saw the pair spike towards 1.1340. The story quoted ‘sources’ stating the EU commission is to propose a 6 month extension for Greece, propose a reorganization of the Troika and table a compromise plan for Greece. The rally faltered quickly though as the market began to realize this proposal likely wasn’t the full story. Reuters then reported the EU commission said there is no formal proposal for Greece but that talks are intensive. EUR/USD slipped back near 1.1285. Buyers emerged though as the earlier rise in the USD abated. A slow ascent took hold and the pair sat near 1.1315 late in the day. Action is likely to remain quiet in Asia as the Europe group meeting is tomorrow. large headline risk likely exists. Should the Greek situation turn more sour it’s likely EUR/USD will sink and we may see the 2015 low retested.