Euro has gone up today, against expectation of many that today could be another black Monday for stocks and devastating for Euro.

Euro opened sharply lower, almost 150 points down from Friday's close at 1.10 area and dropped further towards 1.095, however up sharply from there currently trading at 1.113, up almost 180 points from low.

So what might be driving Euro higher?

Several factors might be working behind Euro's move.

Cash is king - European stocks are down heavily as investors run for safety and in turmoil like this cash is king. European investors are hoarding more cash ahead of the referendum, taking profits on positions. However this move unlikely to fuel Euro beyond a day or two.





European stocks are down heavily as investors run for safety and in turmoil like this cash is king. European investors are hoarding more cash ahead of the referendum, taking profits on positions. However this move unlikely to fuel Euro beyond a day or two. Demand from Greece - Greek government and especially Greek banks should be heavy buyers of liquidity as bank's are heavily short on cash as European Central Bank (ECB) froze liquidity assistance to max $99 billion, which is simply not enough.





Greek government and especially Greek banks should be heavy buyers of liquidity as bank's are heavily short on cash as European Central Bank (ECB) froze liquidity assistance to max $99 billion, which is simply not enough. Demand for liquidity - Banks, investment funds are likely to keep additional buffers till the referendum next Sunday.





Banks, investment funds are likely to keep additional buffers till the referendum next Sunday. Contrarian buyers - Buyers who are betting on that Greek crisis will end happily in spite of the referendum got the Euro cheap today.



Buyers who are betting on that Greek crisis will end happily in spite of the referendum got the Euro cheap today. Greece is too small to tumble Euro - Many would like to buy Euro at cheaper levels since Greece is too small an economy with smaller debt compared to total Euro zone. So it is unlikely that jitters will last since European Monetary Union (EMU) is better prepared now in handling the crisis today compared to 2011/12.



Many would like to buy Euro at cheaper levels since Greece is too small an economy with smaller debt compared to total Euro zone. So it is unlikely that jitters will last since European Monetary Union (EMU) is better prepared now in handling the crisis today compared to 2011/12. Euro, 19 nations currency bloc - European economy is broadly improving and one Greece is not enough to stumble the return of growth and demand for Euro.



European economy is broadly improving and one Greece is not enough to stumble the return of growth and demand for Euro. Technical gap closing - Technically speaking a gap/window generally gets closed, which has occurred so far in almost all Euro based pairs.

Euro is currently trading at 1.112 against dollar, 0.707 against pound and 136.6 against yen. Expect high volatility and noise to persist in the market, focusing on news flow from Euro zone leaders.

Key resistance to watch 1.123-1.125 and support lies around 1.08-1.085.