There’s a report that a secret meeting will be held tonight in Luxembourg to discuss a Greek default. Although unconfirmed, all the signs in the past week led to a restructuring, especially as Greek finally began admitting it can’t pay its debt. EUR/USD more than 100 pips and another support line in one of its worst weeks. Merkel has good reasons to hurry with this move. Update and analysis of the situation. Der Spiegel reports: …the European Commission has called together a crisis meeting in Luxembourg on Friday night. In addition to Greece’s possible exit from the currency union, a speedy restructuring of the country’s debt also features on the agenda. One year after the Greek crisis broke out, the development represents a potentially existential turning point for the European monetary union — regardless which variant is ultimately decided upon for dealing with Greece’s massive troubles This comes on the background of a Greek threat to leave the Euro-zone. I’ve already written how a Greek departure of the Euro-zone will have huge benefits, especially for the Euro. But currently, the rapid events hurt the common currency, already hit by Trichet’s dovishness. EUR/USD lost the 1.4450 support line and is now trading at 1.4380, just above the 1.4375 support line, after these news broke out. Further support is found at 1.4375 and 14282. Resistance is at 1.4520 and 1.4580. For more levels, see the EUR/USD forecast. Why now? Merkel’s political calculations Talks about Greek restructuring have been seen since the beginning of the year, with a softer option of a Brady plan discussed many months ago. But there’s not time for a soft restructuring. In recent weeks it became more clear that a default is near, as the markets reflected it in both CDS and yields, with Greece missing the deficit target and with a restructuring request from the EU / IMF bailout fund. The leaders denied and delayed this decision. But as time goes by, the Greek debt moves from the banks, the private creditors, to the tax payers via the bailout fund. Restructuring now would impose less damage on taxpayers, or voters. Waiting means more not only more pain to the people when the unavoidable happens, but in the meantime, the anger mounts towards these bailouts. The achievements of the True Finns in Finland, a rich EU country, and its reluctance to participates in the Portuguese bailout, can pave the way for a “True Germans” sentiment. This is already happening within the ranks of the German government – the junior coalition partner, the FDP, may decide to oppose a Portuguese bailout in its upcoming convention in Rostock. I believe that Merkel now understands that: A Greek default is unavoidable. Waiting risks the German economy. Waiting risks her already fragile political career. The Greek internal talks of leaving the Euro-zone may serve as another trigger, but German politics play a significant part in tonight’s dramatic meeting in Luxembourg. Yohay Elam Yohay Elam Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts. Yohay's Google Profile View All Post By Yohay Elam Forex News Today: Daily Trading News share Read Next Forex Crunches for the Weekend – May 7 Yohay Elam 12 years There's a report that a secret meeting will be held tonight in Luxembourg to discuss a Greek default. Although unconfirmed, all the signs in the past week led to a restructuring, especially as Greek finally began admitting it can't pay its debt. EUR/USD more than 100 pips and another support line in one of its worst weeks. Merkel has good reasons to hurry with this move. Update and analysis of the situation. Der Spiegel reports: ...the European Commission has called together a crisis meeting in Luxembourg on Friday night. 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