Following the outcome of the referendum, the Greek Prime Minister said Athens was returning to negotiations with the goal to reopen banks, which could run out of cash within days without emergency funding from the ECB. Also, the Greek government announced that Euclid Tsakalotos will be replacing Yanis Varoufakis as the nation's new finance minister. Greece received hard news from IMF Managing Director Christine Lagarde on Monday that policy prohibits lending to countries that have missed payments, although it can offer technical assistance to the staff. Meanwhile, the European Central Bank said it will keep the amount of emergency liquidity available for Greece unchanged. European officials have indicated that they will only continue to finance Greece in return for economic reforms. Currency traders now await Tuesday's critical emergency summit in Brussels between Greece and its European creditors for further indications on the likelihood of a Greek bailout. Elsewhere, the dollar posted slight losses against most major currencies on Monday, after data showed that U.S. service sector activity slowed in June, however, ISM non-manufacturing data rose to 56.0 last month, up from 55.7 in May but below forecasts for 56.2. For today, the Swiss National Bank is to publish data on its foreign currency reserves, the U.K. is to release data on manufacturing and industrial production, while Canada and the U.S. are to release reports on the trade balance.
The euro, posted a sharp drop on Monday after the Greek referendum results, however the EUR/USD pair remains supported above 1.10 as investors are awaiting for the outcome of the critical emergency summit in Brussels, and the possibility of a Greek bailout. Capital controls were extended and Greek banks will remain shut at least until the end of Wednesday while the country also received bad news from IMF Managing Director Christine Lagarde on Monday that policy prohibits lending to countries that have missed payments, although it can offer technical assistance to the staff. The dollar was also under pressure on Monday, after data showed that U.S. service sector activity slowed in June, while ISM non-manufacturing data rose to 56.0 last month, up from 55.7 in May but below forecasts for 56.2. Later in the day the U.S. is due to release data on trade balance, however market sentiment will probably be driven by the outcome of the emergency meeting in Brussels.
Pivot: 1.1085
Support: 1.098; 1.095; 1.09
Resistance: 1.1085; 1.112; 1.1155
Scenario 1: Short positions below 1.1085 with targets @ 1.098 & 1.095 in extension.
Scenario 2: Above 1.1085 look for further upside with 1.112 & 1.1155 as targets.
Comment: As long as 1.1085 is resistance, likely decline to 1.098.
OIL
Oil prices fell to the lowest level in three months on Monday, as developments in Greece combined with worries of a slowdown in China and progress in negotiations with Iran raise concerns about poor demand for the fuel. A nuclear deal adds pressure on crude prices, as Iran reportedly holds 30 million barrels of crude in its reserves ready for export as soon as sanctions are lifted. Investors' attention is now mainly shifted towards an emergency leaders' summit on Tuesday, however, markets will also look ahead as the American Petroleum Institute will release its estimates of weekly inventories and, while more closely-watched figures from the U.S. Department of Energy are due on Wednesday.
Pivot: 55.2
Support: 51.85; 50.58; 49.87
Resistance: 55.2; 56.25; 56.74
Scenario 1: Short positions below 55.2 with targets @ 51.85 & 50.58 in extension.
Scenario 2: Above 55.2 look for further upside with 56.25 & 56.74 as targets.
Comment: As long as 55.2 is resistance, likely decline to 51.85.
DOW JONES
U.S. stocks fell broadly on Monday during a volatile day of trading, as concerns of a collapse in Greece's financial system, possible contagion effects in the rest of Europe, a major slowdown China, along with a massive sell-off in crude futures weighed on the major indices. Energy stocks weighed on both the Dow and the NASDAQ, as WTI crude for August delivery plunged more than 5% on the session to its lowest level since early-April. As a result, shares in major oil companies plummeted. The Dow lost 46.53 or 0.26%. The worst performer was General Electric (NYSE:GE), which fell 0.49 or 1.81%. For today, the U.S. is due to release data on trade balance, however market sentiment will probably be driven by the outcome of the emergency meeting in Brussels.
Pivot: 18350
Support: 17410; 17200; 17040
Resistance: 18350; 18650; 18900
Scenario 1: Short positions below 18350 with targets @ 17410 & 17200 in extension.
Scenario 2: Above 18350 look for further upside with 18650 & 18900 as targets.
Comment: The RSI is bearish and calls for further decline. The index broke below a rising trend line.
APPLE
Apple shares (NASDAQ:AAPL) recovered from weekly lows on Monday, after Deutsche Bank (XETRA:DBKGn) released a research note on Monday, showing confidence in Apple Inc.'s upcoming quarterly earnings on the back of strong iPhone unit sales. The firm believes that the success of the Apple Watch roll out will also be a focus in this quarter, although it doesn't expect Apple Music to have any impact on the earnings. Apple is expected to announce its third quarter earnings of fiscal year 2015 on July 21.
Pivot: 134.4
Support: 118.5; 113; 103.7
Resistance: 134.4; 145.3; 152.5
Scenario 1: Short positions below 134.4 with targets @ 118.5 & 113 in extension.
Scenario 2: Above 134.4 look for further upside with 145.3 & 152.5 as targets.
Comment: The RSI is capped by a bearish trend line.