EUR/USD Apr. 14 – Dropping Below Support on Fresh Debt

EUR/USD lost the support line as talks about a default in Greece and a problematic bailout for Portugal weigh on the common currency. Important US figures are due and will rock the pair as well.  Here’s a quick update on technicals, fundamentals and sentiment currently moving the markets.

EUR/USD Technicals

• Asian session:  Euro/Dollar made another attempt for the 1.4520 line, but couldn’t break higher. The fall came in the European session.
• Current range –  1.4380 – 1.4450

• Further levels in both directions: Below 1.4380, 1.4282, 1.4160, 1.4030, 1.3950, 1.3860, 1.3760
• Above:    1.4450, 1.4520, 1.4580, 1.48, 1.50, 1.5144
• 1.4450 is now resistance, but weaker than earlier. 1.4520 proved to be a tough line.
• 1.4380 is the first line of support, with 1.4282 a stronger line.

Euro/Dollar on high support  – click on the graph to enlarge.

EUR/USD Fundamentals –

• 8:00  ECB Monthly Bulletin. Expressed concern from Mid-East turmoil.
• 12:30 US Unemployment Claims. Exp. 379K.
• 12:30 US PPI. Exp. 1.1%. Core exp. +0.2%.
• 13:00 US FOMC member Elizabeth Duke talks. Exp. Dovish.
• 13:20 US FOMC member  Narayana Kocherlakota talks. Exp. Hawkish.
• 16:30 US FOMC member  Charles Plosser. Exp. hawkish.

* All times are GMT.

For more events later in the week, see the  EUR/USD forecast

EUR/USD Sentiment

• Default for Greece?: There’s lots of speculation about a default for the small country. It’s currently being denied and ignored. When it eventually happens, it could hurt the Euro, but already seems inevitable, after comments from Greek and European officials.
  
• Bailout for Portugal – There’s no government in Lisbon, making it hard to agree on a bailout program. In addition, the outcome of the Greek bailout poses doubts about the chances of successful move in Portugal. Portuguese yields already passed the 9% mark. See more about  The Portuguese bailout
• More rate hikes in Europe? Not so fast: With lower prices of oil in recent days and all the debt fears, the next rate hikes will likely be pushed back.
  
• Fed leaning towards the doves:  After a few  recent hawkish speecheswe now hear from the doves in the Federal Reserve. Dudley and Yellen are definitely in the dovish camp. This weakens the US dollar across the board.