Euro to dollar underwent a significant beating this week, due to the escalation of the Greek crisis but managed to recover on fresh hopes The upcoming week is packed with indicators and ends with the critical European summit. Here’s an outlook for the European events, and an updated technical analysis for EUR/USD, now on lower ground. The deterioration in Greece caught attention all over the world and sent the euro way down. This included a general strike, a reshuffling of the Greek cabinet, more credit downgrades and contagion into Ireland and Spain. The Merkel-Sarkozy summit that included a German retreat from the demand for private sector participation calmed the markets. Is this real or temporary? All this will continue now. Let’s start: EUR/USD daily chart with support and resistance lines marked. Click to enlarge: Greek vote of confidence: Sunday. The parliament in Athens needs to approve the new government, including a new finance minister. Given the public outrage, it isn’t certain that the new government will be approved. Emergency Meeting 2: Sunday. After a first emergency meeting failed earlier, the finance ministers are meeting once again on Sunday and will try to declare a framework for a solution before the markets open. German PPI: Monday, 6:00. Producer prices surprised in May with an unexpected jump of 1%. As May has seen a dip in commodity prices, a drop in producer prices is likely now in this important inflation indicator. There are doubts that the pronounced rate hike will happen. Current Account: Monday, 8:00. While Germany enjoys surpluses in trade, the overall picture in Europe is negative. Last month, the current account deficit stood on 4.7 billion, relatively low in comparison to previous months. A bigger deficit is expected now. German ZEW Economic Sentiment: Tuesday, 9:00. This important and highly regarded survey often disappoints and tends to be more pessimistic than other surveys. It dropped to +3.1 points last month, relatively lower than in previous months, though still optimistic. A drop to a negative figure, meaning pessimism, is likely now. Also the all-European figure is expected to drop from the high score of 13.6 last month. Industrial New Orders: Wednesday, 9:00. The total volume of orders dropped last month by 1.8%, a correction of previous strong gains. Manufacturers probably placed more orders this month. This might give a boost to the euro. Consumer Confidence: Wednesday, 14:00. This official survey by Eurostat has shown pessimism, but smaller than previous months. The score of -10 will probably be repeated now. Flash PMI: Begins at 7:00 in France, continues at 7:30 in Germany and ends with the euro-zone figure at 8:00. All the purchasing managers’ indices have been above 50, meaning growth, for quite some time and are expected to remain this way. The French services PMI is very high, at 62.5 points, and is likely to drop now. The all-European manufacturing PMI is relatively low, at 54.6 points. These multiple releases promise a volatile morning. If all numbers go in the same direction, probably the negative one, it could have a strong impact on the euro. German Ifo Business Climate: Friday, 8:00. The second important German survey might end the week in a positive note. This survey is usually optimistic, exceeding early expectations. It remained unchanged at 114.2 points last time. A small tick up is expected now. European Summit: A preliminary meeting will be held on Monday, but the summit itself is on Thursday and Friday. With the Greek crisis at the headlines, the split European Union will try to reach some kind of solution, even if temporary, for Greece. Headlines from this meeting will rock the euro. * All times are GMT. EUR/USD Technical Analysis Euro dollar managed to rise at the beginning of the week, temporarily crossing the 1.4450 resistance line (mentioned last week) and touching 1.45. This all changed when the big downfall began and the pair went as low as 1.4075 before staging another comeback and closing at 1.43, in one of the more volatile weeks. Technical levels, from top to bottom: 1.4650 was a peak on the way up, and then switched to significant support. It is a rather far well. Another line of resistance is at 1.4550. It had a pivotal role a few weeks ago, when the euro was trading higher. Minor resistance is at 1.4450, which was an important line in the past, and had different roles beforehand. 1.4375 provided support a few weeks ago, and held the pair for a short period of time before the final fall. It returns to having a major role as resistance. The peak of November 2010 at 1.4282 managed to temporarily cushion the falls and eventually support the pair in the close. It ispivotal line for the start of the next week. 1.4160 was a swing high in the past, and also a swing low a few weeks ago, before the big surge to higher levels. It also helped cushion the fall and turned into a pivotal line . Just above the round number of 1.40, we find very important support at 1.4030 – this is a very distinctive line, as seen in the graph. Lower, 1.3950 was a pivotal line when the pair traded in lower ranges and proved that it is of high importance. The fall of the pair stopped short of reaching this line. Another significant support line is at 1.3860, which worked in both directions earlier this year. 1.3570 worked as support at the beginning of the year, and will have the same role if the Euro falls that far. The last important line is 1.3440, that is very distinctive. It was a clear border between ranges, more than once in recent years. A break below will be a very bearish sign. I remain bearish on EUR/USD. The crisis is full blown now, with Spanish yields also at peak levels and a significant lack of leadership. Easing inflationary pressures also aid the fall, as they open the door to more delays in the next rate hike. Unless the European leaders reach some very surprising magical solution, there is room for more falls. Here are additional recommended reads for the pair: Gregor Horvat uses Elliott Wave method to determine the next downside target for the euro. Simon Smith says that the ECB might need to rethink the promised rate hike. Will “strong vigilance” turn into empty words? Micheal Shedlock states that markets already begin rejecting the Greek solution, and sees a fresh escalation at the beginning of the next week. TheGeekKnows reviews the week and looks forward. Andriy Moraru provides weekly support and resistance lines for major pairs, including EUR/USD. Further reading: For a broad view of all the week’s major events worldwide, read the USD outlook. For the Japanese yen, read the USD/JPY forecast. For GBP/USD (cable), look into the British Pound forecast. For the Australian dollar (Aussie), check out the AUD to USD forecast. For the New Zealand dollar (kiwi), read the NZD forecast. For USD/CAD (loonie), check out the Canadian dollar For the Swiss Franc, see the USD/CHF forecast. 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 EUR/USD ForecastMajors share Read Next NZD/USD Outlook – June 20-24 Anat Dror 11 years Euro to dollar underwent a significant beating this week, due to the escalation of the Greek crisis but managed to recover on fresh hopes The upcoming week is packed with indicators and ends with the critical European summit. Here's an outlook for the European events, and an updated technical analysis for EUR/USD, now on lower ground. The deterioration in Greece caught attention all over the world and sent the euro way down. This included a general strike, a reshuffling of the Greek cabinet, more credit downgrades and contagion into Ireland and Spain. 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