Currency analyst: Prepare for euro at $1.05 if Greek crisis escalates

“If the news on Greece is bad in coming days, I think you can see the euro go through $1.10 and then down to $1.05,” said Chris Gothard, head of FX at Brown Brothers Harriman in Europe.

The last time the euro held below $1.05 was in the middle of March, when it touched a 12-year trough against the greenback amid nervousness over Greece’s debt negotiations, pressure of the European Central Bank’s quantitative easing program and speculation about the timing of the Fed rate hike.

On Monday the single currency already fell below $1.10 after a dramatic weekend when talks between Athens and its creditors broke down again and Greece's Prime Minister Alexis Tsipras urged the Greek to vote whether creditors' conditions are acceptable at a referendum this Sunday.

However, the common currency regained ground during Monday’s session to trade around $1.1237 late in New York.

EUR/USD currently trades at 1.1184 shedding 0.44%.

“There’s a lack of confidence in what’s going to happen next with Greece. The weekend gave some news that allowed people to sell and take a bit of position, but within a few hours people realized there still wasn’t that much clarity,” Gothard said on the sidelines of the Fund Forum International conference in Monaco.

He added that long-term investors are now in wait-and-see mode.

Some investors are seeing the Greek turmoil as an investment opportunity when a number of traders are afraid of an increased volatility.

“There are definitely some that are looking at this as a way — on a longer-term basis — to come into the euro at a pretty good level, because they have the confidence that the countries and fiscal mechanisms will recover and the eurozone will be stronger afterward,” he said.