The market opened lower yesterday with after the results of the Greek Election was in favor of the opposition party ‘Syriza’ as they won the election on 25 January. As the party is highly inclined to anti-bailout policy, this would see the possibility of reduced spending of the government towards its economy. This would lead the Greeks into a collision course with its debtors. Fortunately German Institute for Economic Research(Ifo) announced later in the day that the score of 106.7 was as forecast. This rallied the market towards the upside as the stimulus effect started to kick in. This saw the market closed bullish for the day after the price respected the support of 1.110 where the Fibonacci Extension of 200.0% is located at the zone. ADX indicated the slight increase of the bullish market strength. Slightly bullish EURUSD supported at 1.110, which was last seen respected in 2003, might indicate the possibility of a retracement towards the upside.
The market was seen rallying more that 100pips today after the news release from the German Ifo Business Climate. Moving averages on the chart continued to indicate the downward trend for the pair while Stochastic indicated the market was approaching towards the overbought zone. This showed that the market is slightly bullish in this point in time as it traded away from the support of 1.110. ADX indicated the decrease in the bearish market strength which may indicate that the current trend towards the upside may only be a retracement.
H1 charts saw the 20 SMA rebounded from the zone of support at 1.117, and started the retracement towards the upside. MACD showed the indecisiveness of the market as it approaches slightly sideways towards the level 0, this was further indicated by the hesitation of the crossovers. ADX indicated the loss of strength in the previous bearish market as the price started to trade slightly above the support of 1.117. We can expect ECOFIN meetings to be held throughout the day with no other significant news to take note of.