Technical Bias: Slightly Bullish
- EURUSD edges higher for second consecutive day as talks over Greece debt program intensify.
- Greece finance minister Varoufakis confident that a deal will “happen quickly.”
- IFO says German business confidence at 10-month high.
The EURUSD advanced for a second consecutive day on Friday, disregarding the political deadlock over Greece’s bailout program amid a fresh wave of talks between Greece and its Eurozone partners.
The EURUSD touched a session high of 1.0905 on Friday before paring gains in the New York session. The EURUSD consolidated at 1.0841, advancing 0.18 percent. The pair is capping off an ascending structure, likely a correction from its previous lows. Ongoing political pressure over Greece’s bailout program and a stronger dollar could support another descent toward the 1.05 level in the short term.
For now the EURUSD has a short-term bullish bias and is targeting the 1.0891 resistance. On the downside, support is likely found at 1.0711.
The EURUSD started to backtrack after the US Commerce Department reported stronger than expected durable goods orders. Orders for manufactured goods meant to last three years or more rose 4 percent in March after dropping 1.4 percent in February. However, a key gauge of business investment declined for a seventh consecutive month, raising concerns about the business outlook.
Eurozone finance ministers descended on Riga, Latvia on Friday for the latest round of Eurogroup talks. The ministers reportedly hammered Greece for failing to make more progress toward a new bailout deal, calling Greek finance minister Yanis Varoufakis a “time waster, a gambler and an amateur.”
Dutch finance minister and Eurogroup head Jeroen Dijsselbloem acknowledged that “wide differences” between Greece and its creditors still exist, with Athens failing to commit to comprehensive reforms that would unlock its next loan tranche.
Varoufakis insisted that some progress has been made, especially around privatization, tax reforms and the bureaucracy. The Greek finance minister said a new bailout deal “will happen and will happen quickly as it’s the only option we have.”
In economic data, German business confidence rose for a sixth consecutive month in April, reaching a ten-month high. The Ifo business confidence index rose to 108.6 in April from 107.9, reflecting the continuing strength of the German economy. Assessments of the current situation improved to the highest level since June 2014, while optimism about the business outlook was scaled back slightly.