Daily over view

Price Action

• USD/JPY ranges between 77.5--77.75
• AUD/USD runs through 1.0750 on better risk flows
• GBP/USD stalls at 1.5800
• EUR/USD stalls ahead of 1.3300

 Euro advances on relief over Greek parliament vote
    * Hurdles remain ahead of euro zone finmins meeting
    * Voluntary private-sector involvement a worry

    By Luciana Lopez 
    NEW YORK, Feb 13 (Reuters) - The euro rose against the
dollar in light trading on Monday after Greece approved new
austerity measures, but worries about   hurdles in the country's
bid to avoid a disorderly default ate into gains .  
    The Greek parliament passed a package of wage,
pension and job cuts on Sunday, boosting hopes that Athens would
secure more rescue funds from the European Union and
International Monetary Fund ahead of a March bond redemption.
  
    "You got that knee-jerk positive reaction (in the euro), and
that's ultimately starting to fade right now," said Brian Dolan,
chief currency strategist at Forex.com. 
    "There's market suspicion that Greece will meet the targets
it's setting itself, and that we're going to be seeing a replay
of this several months down the road," he added.  
    Markets aren't the only skeptics. Greece must also convince
euro zone finance ministers, who meet on Wednesday. 
    The ministers still require Greece to explain how 325
million euros of this year's total budget cuts will be achieved
before they agree to the 130 billion euro bailout.  
    "We think that Greece is going to get their money by March
20, but we still think the euro's going to sell off," said David
Watt, senior currency strategist at RBC Capital Markets in
Toronto. 
    Volumes were light, analysts said. 
    "Most people are just keeping their heads down, they're
doing things when they have to do it," Watt added. 
    The euro was up 0.36 percent at $1.3220, off a
session high of $1.3283. The single currency faces resistance at
last week's two-month high of $1.3322 and the 100-day moving
average at $1.3325, while traders said a large option expiry at
$1.3300 was likely to restrict further intra-day gains. 
    Analysts at Commerzbank said their euro/dollar order book
model showed a greater density of sell orders at current levels,
adding the $1.3090 area was where the balance became more
neutral, and any downside move may run out of steam there.  
   
   
    Traders were also wary of pushing the euro higher because of
uncertainty over whether private creditors would agree to write
down the value of their Greek holdings. Doubts persist whether
the necessary near-100 percent acceptance can be achieved
without triggering a credit default. 
    "Voluntary private sector participation is unlikely to be at
the levels the IMF and European authorities are looking for and
this is one of the reasons for our bearish view on the euro,"
said Chris Walker, currency strategist at UBS.  
    Even if a voluntary agreement is reached, a debt swap could
take three to four weeks to finalize, leaving a tight deadline
before Greece faces a March 20 bond redemption of nearly 15
billion euros. 
    The euro gave up early gains versus the yen to
trade near flat at 102.32 yen. 
     
    BROKEN PROMISES 
    Germany's finance minister, Wolfgang Schaeuble, said in an
interview with German newspaper Welt am Sonntag that Greek
promises on austerity measures were no longer good enough
because so many vows had been broken.  
    Still, Greece effectively voting to stay in the euro by
passing the measure has provided short-term relief to investors. 
    Fear of a major banking crisis has also subsided as the
European Central Bank was set to provide an unlimited amount of
three-year loans later this month after its first operation in
December. 
    The bank's second offer of three-year funds to banks will
draw 500 billion euros of bids, a Reuters poll of traders
showed, topping the 400 billion predicted in the same poll last
week.  
    Analysts said these factors have prompted institutional
investors to scale back on bearish positions in the euro. But
any bounce above $1.35 could see fresh shorts established. 
    Speculators have been cutting their net euro short positions
for the past two weeks, to 140,593 contracts last week from a
record 171,347 contracts two weeks previously.  
    "If euro/dollar goes up to $1.35, it would be a good level
to short it," said Stuart Frost, head of absolute returns and
currency at fund manager RWC Partners. "Once it gets down to
$1.30 people will again buy it. So it's a range play."