1. The odds of a country exiting the euro zone this year has fallen from above 40% on the eve of the Greek election to about 27% today, according to Intrade.Com. Previously the euro appeared to track the "break up" fear. However, it has found little succor in the reduced exit speculation.

2. We often found that the euro also tends to move in the same direction as the US-German 2-year interest rate differential. The premium the US offers over Germany is hovering around 28 bp, its best level since late 2007.

3. In the options market, there continues to be a premium for euro puts over euro calls equidistant from the money (3-month 25 delta), but that premium has been sharply reduced. As recently as mid-May, participants were paying as much as 3.5% more for puts than calls. Now, they are paying about 1.5%, which is the least since