By FXEmpire.com
Analysis and Recommendations:
The EUR/USD is facing a very volatile weekend, it is trading at 1.2629 and is expected to tumble come Monday, after the Greek election results and the formation of a new government.
Investors have been moving to the sidelines or to safe havens in preparation for the weekend results.
After rallying back above 1.26 in yesterday’s session, EUR is entering the US session flat to where it closed after a notably tight range of just 33 points. Leading into Sunday’s Greek election, some traders covered short positions; however others appear to be building longs as the belief that regardless of the outcome there is more downside than upside priced in, leaving the scales unbalanced in favor of short-term long EUR positions.
Negative eco data from the US, continues to weaken the USD. Today the Empire Manufacturing Index showed a drop in manufacturing in the New York state areas, which is a leading indicator for the overall US.
The Greek Election is unlikely to be the binary risk that many are predicting and for those with deep pockets it might be worth being long EUR into. The potential scenarios include: 1. EUR positive – The ND (conservative, pro-bailout) win a majority; risk of a Greek exit drops. 2. EUR negative (but not a collapse in EUR) – The SYRIZA (radical left, anti-bailout) win a majority and the risk of a Greek exit rises; however a round of negotiations with the troika would ensue, leaving lots of room for avoiding the worst case scenario. In addition a SYRIZA majority likely increases the risk of major and potentially coordinated central bank action, which provides a floor to EUR weakness & potentially, after the knee jerk reaction, a temporary rally. 3. EUR neutral (& most likely) – No majority and the parties attempt to form a coalition over several weeks. Should they fail another election will be held. Uncertainty builds, but with global central banks ready to step in, EUR remains supported.
With elections in France, Greece and Egypt this weekend it should be a very interesting day on Monday.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports
Economic Data June 15, 2012 actual v. forecast
|
Date |
Currency |
Event |
Actual |
Forecast |
Previous |
|
Jun. 15 |
JPY |
Interest Rate Decision |
0.10% |
0.10% |
0.10% |
|
GBP |
Trade Balance |
-10.1B |
-8.5B |
-8.7B |
|
|
EUR |
Employment Change (QoQ) |
-0.2% |
-0.2% |
-0.3% |
|
|
Manufacturing Sales (MoM) |
-0.80% |
1.00% |
1.90% |
||
|
USD |
NY Empire State Manufacturing Index |
2.3 |
13.0 |
17.1 |
Upcoming Economic Events that affect the CHF, EUR, GBP and USD
|
Date |
Time |
Currency |
Event |
Forecast |
Previous |
|
Jun 18 |
18th-22nd |
GBP |
45 |
44 |
|
|
Day 1 |
ALL |
||||
|
Jun 19 |
8:30 |
GBP |
3.0% |
||
|
9:00 |
EUR |
-2.4 |
|||
|
12:30 |
USD |
0.72M |
|||
|
12:30 |
USD |
0.72M |
|||
|
Day 2 |
ALL |
||||
|
Jun 20 |
6:00 |
EUR |
0.2% |
||
|
8:30 |
GBP |
-13.7K |
|||
|
8:30 |
GBP |
0-0-9 |
0-0-9 |
||
|
8:30 |
GBP |
8.2% |
|||
|
9:00 |
CHF |
-4.0 |
|||
|
14:30 |
USD |
-0.2M |
|||
|
16:30 |
USD |
||||
|
16:30 |
USD |
|
|
||
|
18:00 |
USD |
||||
|
18:15 |
USD |
||||
|
Jun 21 |
6:00 |
CHF |
1.33B |
||
|
7:00 |
EUR |
44.7 |
|||
|
7:00 |
EUR |
45.1 |
|||
|
7:15 |
CHF |
7.9% |
|||
|
7:30 |
EUR |
45.2 |
|||
|
7:30 |
EUR |
51.8 |
|||
|
8:00 |
EUR |
9.1B |
|||
|
8:00 |
EUR |
45.1 |
|||
|
8:00 |
EUR |
46.7 |
|||
|
8:30 |
GBP |
-2.3% |
|||
|
10:00 |
GBP |
-17 |
|||
|
12:30 |
USD |
386K |
|||
|
13:00 |
USD |
54.0 |
|||
|
14:00 |
USD |
4.62M |
|||
|
14:00 |
USD |
-5.8 |
|||
|
Jun 22 |
8:00 |
EUR |
106.9 |
||
|
All Day |
EUR |
||||
|
13:00 |
EUR |
-11.2 |
Click here for updated EUR/USD News.
Originally posted here
