878
Currency Analyst since 2010

EUR/USD: forecast for June 29 - July 5

Euro zone’s finance ministers failed again to reach an agreement about Greece on Thursday. The talks will resume on Saturday, June 27. According to German Chancellor Angela Merkel, it’s “crucial” to finally get the deal this time. For now the biggest problem in negotiations is that Greek Prime Minister Alexis Tsypras refuses to cut pensions. However, if Tsypras accepts more austerity, he may lose support of the parliament and will have to seek a fresh mandate.

There are 2 scenarios ahead: either the Eurogroup secures a bailout for Greece and helps it avert default or it starts developing measures to protect the euro area from the financial market turmoil. Greek government has to repay 1.6 billion euro to the IMF on Tuesday. Note that German parliament has to ratify any changes first before paying for a bailout.

Taking all into account the negotiations that will take place during the weekend, we can expect a volatile opening on Monday. EUR/USD stabilized between in the 1.12 area ahead of the news. Support is at 1.1050 and then at 1.0965 and 1.0825. Resistance is at 1.1300, 1.1465 and 1.1665. In our view, even in case of a Greek relief, the euro’s rally will be short-lived and will represent an opportunity to open short positions.

As for the euro area’s economic calendar, it’s not very full, pay attention to flash inflation data on Tuesday.

EUR
Scroll to top