Support Continues to Erode for the Euro

The Euro took a stab at the downside making a new low forthe year in the process by taking out the late March bottom at 1.3267.

The Euro took a stab at the downside making a new low forthe year in the process by taking out the late March bottom at 1.3267. Althoughthe break to 1.3257 was met with profit-taking and bottom picking, the fundamentalsare still suggesting that this pair has a long way to go before support isestablished.

At the mid-session, Greece continues to move closer tosovereign debt default. It looks as if the bailout from the EU/IMF proposedearlier in the month will not be enough to meet Greece’s financial obligations. Thecost to finance the debt is sky-rocketing so unless there is a plan in theworks to rewrite Greece’sfinancial obligations it looks as if it has no choice but to default. Contagionis another concern for investors. As the Greek financial situation worsens, sodo the financial problems in Portugaland Spain.