Euro Rises On Greek Bailout Hopes Feb 18, 2015
Greeks To As For Extension Of Program? Not So Fast
I have to admit I find it comical that the Euro would find strength on the release of an article from an unidentified “source” that Greece will ask for an extension of the bail out. These idiots must not have read the full article like I just did. Yes the title is alluring but when one reads the quotes toward the end you can see its just a farce. Having said that I dont really think they are idiots ( however they did cause the mess we are in today) but as I was discussing with a member yesterday, my thoughts are they are just pushing price one direction on headlines one day and pulling it back the next because they have no idea what Greece will do and dont want to be caught with large open positions when the hammer does fall. Below is the title of the article and the quote thats most interesting.
Greece intends to seek extension of loan agreement Wednesday: source
“We’re not accepting ultimatums. We’re not going to request an extension of the program/bailout,” the official said on condition of anonymity. “We’re examining the possibility of requesting an extension of the loan agreement, clearly differentiating it from the program/bailout.”
Now how is that any different than anything else that has been going on over the last weeks since the election of the new Greek government. Nothing that I can see. On top of that why would the Greek people want a further bail out of the big European banks at the cost to their people. Its a well known fact that 95% of all the bail out money has gone to pay the banks while the people in Greece suffer. Yes the powers in Greece caused the whole mess but its already been proven that what Germany thinks is the fix, will not work. So what will work? Well the same thing that worked for Germany when it was bankrupt. A 50% write off of their debt. Yes many probably dont know the when Germany got reunified lenders took a 50% hit on German debt and thats what allowed Germany to prosper and make the reforms necessary to make it what it is today. Funny huh? I really enjoyed Max Keisers (losing his rag LOL) take on how ALL the major banks, including central banks, are morally and financially bankrupt. Take a look below.
EUR/USD Tests Highs On Hopes For Greek Deal
With the EUR/USD retracing to test last weeks highs I wont be having a bias on direction today. Fundamentally I have my doubts they will break out to the upside but that wont create a bias for the short. The best level for a short is up at 1.1439 but if they can widen the Asian range significantly its highs will be valid but carry more risk. The best long will be from the lows around 1.1326 but if they push there I would rather be short looking to take profits.
GBP/USD Short Of Second Push
The second push on the GBP/USD has a few issues with it being well short of 90% of the ADR and bottoming at yesterdays lows. The conviction is not all that convincing so I will be treating it as still a first push scenario and more open for the long. The best level for the short is up at 1.5390 but the weaker 1.5364 is valid if they test during Asia and widen the Asian range more. Otherwise I will consider a long from 1.5335 but would prefer a stop run to yesterdays lows.
EUR/JPY Shows Extended Push With Euro
Considering the extended move and three intraday pushes on the EUR/JPY I will remain open on direction today. There is also the BOJ Press Conference coming up so I will be staying away from Yen crosses this morning. Since we have a wide Asian range already the best level for a short is at 136.21 not far from the Asia high. I will consider the long from 135.54 as well. While the Asian high and low are valid I expect one side will be blown on the news release.
Forex News Today
The calendar has the BOE Interest Rate, Asset Purchase and Unemployment Rate during the London session today. I don’t expect much from this unless there is a surprise in the vote count. I highly doubt there will be any who vote to hike rates or increase the Asset Purchases so it should be a non event.
Later the US has Building Permits, Inflation data, and Housing Starts all released at the same time. While opposite misses are likely to offset and limit a move larger disappointments should weaken the USD at least temporarily. Industrial and Manufacturing Production are a little later and expected to improve slightly on the Industrial side. If we have disappointments below zero again USD weakness while a larger surprise up on the Industrial data could cause USD strength. Having said that baring any large misses they may just wait for the Fed Meeting Minutes late in the day to see if there will be any changes in the next statement wording on interest rates.
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