26 Jan 2015
EUR has a volatile session as Syriza coalition fuels uncertainty – Scotiabank
FXStreet (Barcelona) - Camilla Sutton CFA, CMT, Chief FX Strategist at Scotiabank, shares that EUR/USD dropped to fresh lows over the Greek election uncertainty as Syriza failed to win a full majority, and further expects that EUR might trend lower over time with immediate risks being the inflation and Fed decision in the coming days.
Key Quotes
“EUR dropped to fresh lows, falling briefly below 1.1100 on Greek election uncertainty before rallying over 100 points into the NA open.“
“Syriza, led by Alexis Tsipras, failed to win a full majority, wining just 149 out of the required 151 seats, and accordingly has formed a coalition government; early reports are that it will turn to the Independent Greeks. Once a coalition is formed discussions will begin on renegotiating the bailout agreement with the Troika; the near term complication comes with upcoming debt re‐payments.”
“The German IFO was vaguely better than expected; however for EUR the clear near‐term risk is domestic inflation and the Fed decision. We expect EUR to trend lower over time.”
“EURUSD short‐term technicals: bearish—the RSI, at 19, is well into oversold territory, however all other technical studies warn of ongoing downside risk. We are biased to be short, recognizing that the intraday trading ranges are widening.”
“The next major level of support is at the psychological 1.1000; while resistance lies at Friday’s open of 1.1366.”
Key Quotes
“EUR dropped to fresh lows, falling briefly below 1.1100 on Greek election uncertainty before rallying over 100 points into the NA open.“
“Syriza, led by Alexis Tsipras, failed to win a full majority, wining just 149 out of the required 151 seats, and accordingly has formed a coalition government; early reports are that it will turn to the Independent Greeks. Once a coalition is formed discussions will begin on renegotiating the bailout agreement with the Troika; the near term complication comes with upcoming debt re‐payments.”
“The German IFO was vaguely better than expected; however for EUR the clear near‐term risk is domestic inflation and the Fed decision. We expect EUR to trend lower over time.”
“EURUSD short‐term technicals: bearish—the RSI, at 19, is well into oversold territory, however all other technical studies warn of ongoing downside risk. We are biased to be short, recognizing that the intraday trading ranges are widening.”
“The next major level of support is at the psychological 1.1000; while resistance lies at Friday’s open of 1.1366.”