Following the change of negotiatior for Greece hinted an interest of Greek Prime Minister Tsipras to make a deal with eurozone's representatives. Such step helped to support euro to get back to $1.0900, together with dollar weakness
Greek Finance Minister Varoufakis has been replaced with Deputy Foreign Minister Tsakalotos, who is known for having better relations with European institutions. Varoufakis was blamed for not seeking a deal and wasting the time to end program negotiations.
This is highly believed by markets as a sign of greek government interested in reaching an agreement and not to support previous fears of a Grexit, or even turn to Russian state due to financing.
From the fundamental point of view, in a long-term perspective, we believe in bearish trend, but these short-term positive signs from the eurozone help the currency to sustain bearish pressure as an initial optimism from the European Central Bank's (ECB) persists and Greek issue seems to be closer to solution without Varoufakis. Moreover, general weakness of the US dollar had boosting effect for the euro and now traders will be watching the Federal Open Market Committee (FOMC) to decide last time before the so-much mentioned June's meeting, where the rate-hike 'should be on the table,' according to previous quotes. Nevertheless, scepticism from the first quarter leave the rate-hike in the frame of 2015, but June's liftoff became less expected as before due to lackluster Q1 data.
From the technical point of view, euro could reach even $1.1032, a resistance for bulls, but lacking any strong support from the real economy, we expect the dollar to get back on its path and EUR/USD to be dragged down to $1.0719, with later supports at $1.0581 and $1.0491.
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