Friday, February 17, 2012
For the past two days, their has been strong risk appetite in the market due to optimism over a 2nd bailout package for Greece. Since Greece officials have already approved & voted for the necessary debt restructuring, this has given investors a reason to increase risk sentiment and move into higher yielding assets. The common currency has rallied along with other risk currencies against the US dollar following a bunch of strong economic data. The ECB has swaped its existing Greek bonds for new bonds and it appears that signs of securing a more stable Eurozone is on the horizon. However, the rally in the EUR/USD will not continue any further ahead of the weekend as further clarity on the details of a proposed Greek deal get released on next Monday. Traders have sought to close out existing positions and are unwilling to hold any bets over the weekend, so this may result in a retracement or correction in the trend, as institutions take profit.
Thursday, February 16, 2012
During today's trading session, we saw the market bias shift from risk aversion, during the Asian & European Sessions, to risk appetite, in the US session, as encouraging news came from fair US economic data and updates on the European bailout package for Greece, that increased risk sentiment. The EUR/USD pair had rallied ~184 pips from the session low at 1.2975 and it appears to want to extend its gains even higher.
In today's technical analysis video, we will describe price action in the currency pair and identify trade entries around support & resistance levels.