EUR Trading Outlook (20-02-2015)

EUR/USD The pair sat just below 1.1400 in early NY after Europe smacked the pair down after another failed attempt at break 1.1450/60 resistance. Germany’s rejection of Greece’s extension proposal then saw the pair dive again. A low of 1.1355 was quickly hit. Broad USD strength aided the pair’s dive. Bears ran out of gas though as the USD began giving up ground. A return towards NY’s open ensued but the lift couldn’t be sustained. An afternoon lift for the USD on firm US bond yields pressed EUR/USD lower again. Also pressing on the pair was a German position paper noting that Greece’s request was a ‘trojan horse’ that would replace the bailout program with bridge financing. EUR/USD slipped below the 200-HMA again and sat just above the day’s low into the close. Traders now look to tomorrow’s Euro group meeting for their next cues. If the Greek situation deteriorates it’s likely EUR/USD gets hit and we may see a test of key support in the 1.1260/70 area.