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Greek leader  Karatzaferis came out with a harsh statement: “we don’t need the German boot” and said he would vote against the bailout program proposed by the troika.

EUR/USD lost distinct support and other currencies are slammed against the safe haven dollar.

Political Background

Karatzaferis  is probably reading the opinion polls. Since he joined the coalition Papademos government, support for his small right wing party fell significantly.

A smaller and more extreme right wing party is gaining traction. So are small opposition left wing parties. The mainstream PASOK party is on the fall.

The New Democracy party and PASOK could pass the measures without the  Karatzaferis lead LAOS party, but a large majority is needed to convince the world that current policies will prevail after the elections as well.

Fresh figures showed the Greek unemployment jumped above 20%, industrial production is dropping sharply and tax revenue fell short of expectations, and certainly not for the first time.

EUR/USD

EUR/USD dropped sharply form the middle of the 1.3212 to 1.3280 zone down under 1.32. The 1.3212 was very distinct recently.

If this breakdown is confirmed, the next support line is at 1.3145, but it’s a weak line. The pair was battling with the 1.3280 line during the past few days, as 1.3212 provided support.

For more on the euro, see the EUR/USD forecast.

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