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The emergency  announcement of a 30M euro mechanism to bail Greece out    sent EUR/USD high above the close. Other currencies made significant leaps as well – some are big breakouts.Is it here to stay? We’ll know quite soon.

The European finance ministers made an unusually timed teleconference on Sunday, and came out with a dramatic announcement – an approval of a mechanism that will supply Greece a huge safety net for borrowing below market rates – 30 billion euros. Adding 10 billion euros of IMF money, Greece gets a big breather. Coordinations between the EU and the IMF will begin on Monday.

This news of a rescue plan are good news for the Euro, and for global recovery. The announcement came at a perfect timing for forex trading.

Just as the markets opened, traders in the Sydney session sent the dollar to the ground on risk appetite trading.

EUR/USD leaped above 1.36, a high it reached two weeks ago and reached 1.3672, the highest level since March 18th. It now trades lower, but still more than100 pips above the close on Friday. A huge weekend gap.  The Euro is not alone.

GBP/USD confirmed the break of the stubborn hurdle of 1.5350 and peaked at 1.5467 before calming down. This is the highest level since February 24th.

Another big winner is the Aussie, which jumped above the extremely strong resistance of 0.9327 and reached 0.9388, the highest since November and very close to the 2009 high of 0.9405.

The Canadian dollar isn’t enjoying this dollar weakness, as it struggles with parity, and also begins getting a status of a “safe haven” currency – sought in times of trouble and unwanted on optimism. USD/CAD didn’t make strong moves.

Is this just jumpy,thin volume trading?

This is the big question. Volume is low at the very start of the week, as it’s only Sunday evening in the US and night time in Europe. The Tokyo session didn’t begin yet, so we’re only with the Sydney session.  Things could change when the Tokyo session begins at midnight GMT. These gaps could be filled.

Learning from the past, if the gaps aren’t closed within an hour of the opening of Tokyo session – it means that the market is really moving, and that the trend, dollar weakness here, will continue through the London and New York sessions.

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