By Mario Sant Singh

Following Sunday's election victory, Mr Antonis Samaras, the leader of the conservative New Democracy party, pledged to honour Greece's commitments but says he wants to ease the terms of an unpopular EU-IMF bailout deal which has imposed harsh austerity on many Greeks in return for a multi-billion-euro rescue package.

Amid the tension and frustration surrounding Greece, markets reacted positively. At yesterday's opening, EUR/USD gapped up 40 pips to open at 1.2695. Data from the Washington- based Commodity Futures Trading Commission also showed that hedge funds and other large speculators reduced short EUR/USD trades from a record high in the previous week.

"Net Short" EUR/USD contracts dropped about 20,000 - from 214,418 the week before to 195,187 at the close of last week. This tells us that the result of the Greek election is positive for risk.