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The U.S. Dollar is trading slightly better this morning versus most major currencies. The focus continues to remain on the Euro which has recovered most of its early session loss. Euro traders are reportedly reacting positively to news that further financial aid may be available for Greece.
Caution remains the theme amongst Euro traders, however, following last week’s losses. Currently, the April 18 main bottom at 1.4257 is preventing a Euro meltdown. With a short-term top at 1.4940 and a low at 1.4253, even good news is expected to only trigger a retracement of this range back to 1.4596 to 1.4678 over the near-term.
1.4157 Holding as Support
Despite the cut in Greece’s long-term sovereign-debt rating to B from BBB-minus by Standard & Poor’s Ratings Services, Euro traders are reacting as if this news had already been factored in to the current price.
Today the market is trading inside Monday’s range which indicates indecision. Traders could be waiting for a reaction by German Chancellor Angela Merkel who is reportedly waiting for the results of an evaluation of the Greek bailout program. According to Dow Jones Newswires, the new aid package for Greece could be worth nearly 60 billion Euros ($86.1 billion) to cover its funding needs into 2013.
Look for the Euro to mount a likely short-covering rally should the aid package be announced as expected. Anything less is likely to trigger a fresh leg lower.
