The Euro is rising against all the major currencies at the moment. After a week that began with sharp drops against the majors, the Euro is now correcting its losses and the EUR/USD pair has reached above the 1.3650 level.
After the European Central Bank (ECB) declared that the Euro-Zone's Interest Rates will remain at 1.00% it seemed that the Euro will continue to trample vs. the Dollar. This came after a week that continued the past month's trend. It seemed that investors were looking for safer assets such as the Dollar and the Yen. However it now appears that investors were simply waiting for developments in the Greek frontier.
European governments have recently offered a $61 Billion rescue package for the Greek economy. This has eased concerns regarding a potential crisis in the Euro-Zone following high Greek borrowing costs, which surged to an 11-year high. The immediate reaction has boosted the Euro against all the major currencies, boosting the Euro by almost 400 pips against the Dollar since Friday. It currently seems that the preliminary impact has yet to be completed, and that the Euro has potential to strengthen even more.
Looking ahead to this week, traders should first and foremost follow any development regarding the Greek bailout package. This is by far the most significant issue at the moment, and the market is likely to respond to every notification about it. In addition, traders should also follow the major news publications from the Euro-Zone, especially from Germany, as this is also likely to impact the Euro.