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Market Analysis

Home » Featured » EURUSD Backtracks as Greece Pushes for Wartime Reparations

EURUSD Backtracks as Greece Pushes for Wartime Reparations

Posted by FXTimes in Featured - April 7th, 2015 4:07 pm GMT

euro eurchf

Technical Bias: Bearish


  • EURUSD declines 90 pips to 1.0843; EURGBP declines 41 pips to 0.7303.
  • Greece officially unveils demand for WWII reparations from Germany.
  • Sentix Eurozone investor confidence improves in April, reaching highest level since 2007.

The EURUSD declined sharply on Tuesday, posting a daily low of 1.0835 as economic data collided with a deepening Greek debt crisis.

The EURUSD stumbled below the 1.0876 support level and is now testing 1.0830. The pair declined 90 pips to 1.0843. The next resistance level is likely situated at 1.0979. The 1-hour chart is showing bearish signals, with the MACD pointing to downward momentum.


Screenshot (210)


The euro also fell against the British pound. The EURGBP bottomed out at 0.7285 in intraday trade. It would subsequently consolidate at 0.7303, declining 40 pips.

The euro was under pressure after Greece officially released its demand for WWII reparations from Germany. Athens is seeking €279 billion from Germany stemming from the Nazi regime’s occupation of the Hellenic Republic during the Second World War. Greece’s Deputy Finance Minister Dimitris Mardas, who has been at the centre of ongoing negotiations between Athens and the Eurozone, announced the reparations in a parliamentary meeting on Monday.

Germany had previously rejected Greece’s claims for reparations, arguing that it had already settled its historic debt.

The demand comes amid ongoing negotiations between Greece and the Eurozone about a new bailout agreement and a two days before Athens is scheduled to pay the International Monetary Fund €458 million. The Greek government has given mixed messages about its intention to pay the IMF on April 9. Last week a senior Greek official told The Daily Telegraph that Athens was prepared to default to the IMF and re-introduce the drachma if it meant upholding its “left-wing” platform.

In economic data, Eurozone investor confidence improved further in April, offering further evidence the currency region was gradually recovering. The Sentix Eurozone investor confidence indicator climbed to 20.0 in April from 18.6 in March. That was the highest level since August 2007.

Separately, Markit Group said the Eurozone economy improved in the first quarter, enjoying its strongest momentum since 2011. Markit’s Eurozone composite PMI was confirmed at 54.1 in March, final estimates showed on Tuesday. The report indicated that the Eurozone economy was gradually recovering, despite a sluggish first quarter.

According to Markit chief economist Chris Williamson, Eurozone GDP expanded 0.3 percent in the first quarter.

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