EUR/USD Loses Support As There’s No Light at the End

EUR/USD lost another line of support after a pause. This comes as talks on Greece are deep in the mud. In addition, protests are raging in Athens, and Greek prime minister has already suggested that he will resign. Updates.

Euro/Dollar lost the 1.4282 level after struggling with it during the day, and is now at 1.4209. Further support is at 1.4160, followed by 1.4030. Why?

Update: The falls continue, and the pair is now at 1.4190.

Update II: Some support is found at 1.4160.

The emergency meeting in Brussels yesterday has ended with no result. It seemed that the stance of the ECB against any involuntary restructuring was accepted by some members.

Today it looks different:

• Germany’s finance minister says private sector involvement is still on the agenda. This follows his letter from last week.
• French banks have been warned about a downgrade by Moody’s due to exposure to Greek debt.
• The ECB is still determined not to allow restructuring. The deadlock continues.
• A general strike in Greece includes ports and railway stations.
• Protests in Greece are huge today.
• The Greek prime Minister has offered his resignation in order to have national unity government. This comes after one member of his party quit and now rejects the government’s measures.
• Contagion in Ireland: If restructuring is made for Greek government debt, why shouldn’t it be done in Ireland, and for banks?
• Contagion in Spain: Spanish bond yields are nearing all time highs at 5.55%.

There are unconfirmed rumors that workers are cleaning up a tunnel from the Greek parliament to the port of  Piraeus, in order to evacuate the parliament members in case of emergency. Even if this is true, the port is on strike.

Further reading:

• German banks are already willing to volunteer to participate in Greek losses.
• Euro to dollar forecast: For technical analysis and upcoming events.