EUR/USD is trading roughly flat today at 1.1012

Here's the case against the euro:

  1. Today's bounce after weak US retail sales was totally wiped out (and more) in just a few hours.
  2. The Greek deal sends a message to the rest of the Eurozone that Germany won't tolerate a departure from austerity towards stimulative investment.
  3. The Greek government could still fall apart.
  4. If not, better risk appetite will slowly lure traders into EUR-funded carry trades
  5. The ECB is still buying 60B euros of bonds/month

The case for the euro

  1. Safe haven demand for bunds could drop if a Grexit is off the table. The higher yields could put another squeeze on carry trades
  2. Eurozone economic data has been solid (although unspectacular)
  3. Euro shorts are still an awfully crowded trade
  4. The USD side of the trade might not be as solid if economic data like retail sales continues. Business investment has been dismal. Earnings could be soft and that would hurt stocks and USD.
  5. There is an undeniable series of higher lows on the chart and we're close to support at 1.0915

The preponderance of evidence points to the downside but don't underestimate how jittery the market can get at earnings season. In any case, I see much better cases building for CAD and GBP trades than the schizophrenic euro market.