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Greece has submitted an extension request that  basically accepts European demands and makes an effort to appease the voters that may be angry with the acceptance of the troika and the current agreements. However, this was not enough for Germany.

EUR/USD, which was already sliding, is pressured to the downside as the drama continues and aims to cause a split within core countries.

Update:  Greek request creates divide in the euro-zone

Here is part of the Greek letter:

To commence work between the technical teams on a possible new Contract for Recovery and Growth that the Greek authorities envisage between Greece, Europe and the International Monetary Fund which could follow the current Agreement

Germany responded quite quickly with an outright rejection. They said that the letter doesn’t offer a sustainable solution and that the letter is not in line with what was agreed by the Eurogroup criteria. They offered a very short  rejection.

German Chancellor Angela Merkel and French President Françios Hollande meet tomorrow ahead of the Eurogroup at 14:00 GMT. This may be a very interesting meeting.

Opinion:  Grexit Probability Higher Than In 2012; ECB Puts Pressure On Greece – Barclays

Here is how this looks on the chart:

Greece surrenders Germany rejects EURUSD down February 19 2015 not over yet