Greece is in a process of negotiating to finalize the details of its second international bailout, for 130 billion, and must convince the so-called “troika” that the country is doing everything it can to implement required austerity measures. That will not be easy. With the inspectors due in Athens on January 15, there is a big divide between the government and labor unions. To date the government slashed pensions, salaries, and repeatedly hiked taxes, which sparked a string of general strikes and demonstrations. Now the country’s biggest labor union, the GSEE, ruled out any further income losses saying Greeks had suffered enough from two years of austerity. This brings forth a real possibility of a default, with ripple effects across the continent. In addition, apparently a taboo as late as last week, exiting the Euro by Greece is becoming a subject of increased speculation. Personally, I think that rather than harming the Euro (not the image), such development would be positive for the common currency over time. Initial reaction would be very volatile and probably negative, though. At any rate, a lot will be decided in mid January. It may take someone with an online international business degree to step in and help Greece figure out how to fix their financial problems

Earlier this week I discussed a simple non-directional play in the USD-CHF. I was looking for a breakout from the tight range the price formed on Monday. The move turned out to be down, triggering my sell order and rapidly reaching the 40 pips objective. Good way to start the year.

There are all kinds of things happening in almost all currency pairs. The uncertainty is great and large moves are possible in both directions everywhere we look. And the volatility is likely to increase. I have a lot trades all over the place mostly using shorter-term charts. One of the new trades I am considering is in the GBP-CAD pair. Here going long at 1.5893 could catch a nice rally, if it happens. My objective is 100 pips, hopefully fast.

Mike K.