Over the past 24 hours we have seen limited price action in the major money markets we monitor each day and the reason behind this is two-fold: first, traders globally are mainly focused on the Greek debt issue and talks where we had no progress whatsoever and secondly, the economic calendar was pretty much empty. This resulted in a mostly sideways trading day for most instruments and given the lack of any scheduled events today we could see more of the same.
Keeping in mind that today is the last day of the week and traders might look to bank any short-term profits from this week’s trading sessions volatility will most likely be at low levels once more. As we mentioned above, market participants have their eye fixed on the talks between Greece and its creditors and it looks as if we’re heading towards another stalemate that might or might not be resolved at the last minute.
As such traders preferred to remain cautious yesterday and we can tell just by looking at Euro’s chart for the past week. The Single currency has found a temporary balance point around the 1.1200 level and has spent the past 2 days trading either side of this figure. However if traders decide to take some profits off the table after the Euro’s decline from the 1.1400 area we could see a small correction to the upside and the 1.1300 area appears as the first level of interest.
Similarly quiet was the Cable yesterday coming off it 1.5700 lows only to trade 50 pips higher and stagnate there. We had a limited amount of news from the UK during the last few days and with no significant US-related data either the Cable has been trading off the Greek issue news and developments and we should expect more of the same today. Again, if traders look to liquidate some short-term bearish positions ahead of the weekend we could see a further correction towards the 1.5800 area today.
With the economic calendar mostly empty today and the Greek talks having reached a stalemate point again we believe we should be focused on short-term positions and swings. Traders are waiting to see how the Greek issue will be resolved and until that they will remain hesitant to participate into any serious position-taking hence volatility should remain limited and price action uninteresting.
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