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Is EUR/USD the preferred pair to trade the Greek vote? This depends on the result.  The Greek parliament is set to vote on the austerity measures at 12:00 GMT. Tension is mounting towards this critical event for the global economy.

A “yes” vote is a precondition for the next tranche of aid from the EU and IMF, as well as for a second bailout package. Expectations now lead towards an approval of the measures, and this makes the euro/dollar exposed to surprises, making way for alternatives. AUD/USD is a much better candidate.

While the Greek police is using tons of teargas to disperse protesters in Athens, it seems that the measures will pass. Members of the Pasok ruling party are likely to obey in large numbers. More importantly, not all opposition parties will vote “no”. As an absolute majority isn’t needed, a “yes” vote seems more likely.

And the market already prices it.

EUR/USD rallied and settled higher, capped by the 1.4375 line, but high above previous levels. This came in anticipation for the positive result.

So, if the parliament surprises and votes “no”, it will be a shocking disappointment that will send the euro down across the board.

But  an expected “yes” vote is quite tricky for the pair. On one hand, this is good news that should help the pair. On the other hand, we often see “buy the rumor, sell the fact” behavior. What exactly will happen? Hard to say.

So, a better way to trade it is using a more distinctive “risk” currency: the Australian dollar. The Aussie rises on hopes for the global economy, and falls when fear rules. In addition, AUD/USD is a more predictable pair than EUR/USD.

Also here, a “no” vote will likely send AUD/USD lower. But contrary to the risks concerning the euro, a “yes” vote has a better chance of starting a rally here.

What do you think?

For more on AUD/USD technical levels and events, see the Australian dollar outlook.

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