Summary: We start this week with the EUR/USD on the backfoot as we have falling equities in Europe and weaker US futures, as well as a move into German and US bonds for safety. The pressure is again on the sovereign debt situation with the decision to give Greece its next installment of aid from the EU/IMF as the major risk factor currently. Expectations of a default continue to permeate the market and as a result we see markets paring the gains from last week’s “risk-on” rally. Can stocks stabilize and give higher yielders some reprieve? That will be the main story to look out for as fundamental data will be sparse, though we do have President Obama unveiling a deficit reduction plan of $3 trillion with a heavy emphasis on taxing the wealthy.

For more on Euro-zone, see Today’ Fundamental Update: Euro Crisis Drags on, EUR/USD Slides Below 1.37 as Greek Default Worries Back in Spotlight

For a technical look at EUR/USD see: EUR/USD Forecast: Swing Projection Targets 1.3250

For more on Obama’s Deficit Plan see: Obama’s Plan to Call for $3 Trillion in Deficit Reduction, Half Coming From Taxes on Wealthy

Nick Nasad
Chief Market Analyst
FXTimes

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