Comments made by the Eurogroup's head Jean-Claude Juncker sent the EUR lower, as he said that the debt negotiations with Greece continue to be ultra difficult putting to rest some of the rumors swirling around this week that a deal may be forthcoming shortly.
He also said that the measure from the January 30th summit were largely insufficient and said that it is not necessary to appoint a commissioner to take on the role of policing Greece's budget.
European leaders will meet on Monday to further discuss Greece and the 2nd bailout package's terms and conditions. The hope was to have the debt deal in place before hand, but it looks like the market will continue to face this uncertainty as we move forward.
The news brought the EUR/USD back to below the 1.31 level, pushed the EUR/GBP below its low for the week at 0.8280, and caused the EUR to slide against the commodity block of currencies - AUD, NZD, CAD - with the New Zealand dollar particularly strong. The EUR/USD, EUR/JPY, and EUR/CAD traded in defined ranges from earlier this week, while the EUR/NZD, EUR/GBP, and EUR/AUD broke new lows for the week.
For a technical analysis look at the EUR/GBP see today's technical update: EUR/GBP Confirming Bearish Continuation From Wedge Breakout
With the market more alert for possible intervention from the SNB, the EUR/CHF still eased to trade below 1.2050 at the start of NY trading, after bouncing down off the 200-ema in the hourly timeframe. The pair had been as low as 1.2030 earlier this week.
From Financial Times: We believe the SNB will hold the floor with the utmost determination, said analysts at Credit Suisse in a note to clients. The SNB has made it clear that even at the current rate, the franc is still high and should continue to weaken over time.
However, a second round of intervention could be more costly. Analysts at UBS estimate that the SNB spent SFr7bn when it first set a ceiling of SFr1.20 by buying euros to weaken its currency.
Valentin Marinov, foreign exchange strategist at Citi, estimates that the SNB could have to spend twice as much if it intervenes in the coming days due to the build-up of positions close to the SNB's floor.
While the Euro comes under pressure, market participants may be unwilling to put on new positions with Fed Chairman Bernanke set to testify in front of Congress, and tomorrow's NFP report important event risks.
For more on EUR/CHF see our technical update: EUR/CHF Breaks Above Channel with SNB Intervention Watch On
Nick Nasad is an analyst, educator, and trader; and one of the main contributors to FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.