The EUR/USD started the week off quietly with both French and German Bank Holiday's today.
Currently the Eurodollar is up 31 pips versus the US Dollar, 1.4380.
ECB President Trichet spoke this morning at the London School of Economics; these were some of his comments:
TRICHET: Euro zone recovery now more firmly established
TRICHET: Have seen upward risks to price stability in recent months
TRICHET: Current unemployment remains much too high
TRICHET: ECB needs to make sure that recent oil and commodity price gains do not lead to further inflationary problems.
TRICHET: Euro zone economic recovery stood more firmly established now, despite the high 10 percent unemployment rate over the euro zone
TRICHET: Governments should avoid compulsory restructuring
TRICHET: We need to avoid credit event or selective default
TRICHET: My working assumption does not include countries leaving euro zone
The following are the important economic releases this week:
Wednesday June 15th All Day - ECOFIN Meetings, The Economic and Financial Affairs Council (ECOFIN), The Eurozone's broadest financial decision making body
It will be interesting to see if there are any comments made concerning Greece's debt woes.
Wednesday June 15th 5:00AM EST - Industrial Production m/m .2% forecast vs. -.1% previous
Thursday June 16th 5:00AM EST - CPI y/y 2.7% forecast vs. 2.7% previous; Core CPI y/y 1.6% forecast vs. 1.6% previous
Thursday June 16th 8:00PM EST - ECB President Trichet Speaks at the Annual Benefit Gala organized by US SciencesPo in New York
In terms of risk appetite, the 2 most important events this week will be the China inflation numbers on Monday June 13th at 10:00PM EST and news concerning Greek crisis.
It's important to note that US equities have had six straight weeks of losses.
If we have any form of relief rally in equities, EUR/USD can see itself hitting 1.45 before the selloff continues.
Weekly Support levels - 1.4215, 1.4082, 1.3841
Weekly Resistance levels - 1.4589, 1.4830, 1.4963
Weekly pivot level - 1.4456
The following is a 4hr chart of the EUR/USD, notice the head and shoulders formation (circles) and strong support at 1.4320:
The chart below is the daily EUR/USD, price action hit the 55 Daily SMA of 1.4397 before moving lower: