EUR/USD and GBP/USD Forecast - 28 September 2016

EUR/USD

The EUR/USD pair fell rather significantly during the course of the day on Tuesday, testing the 1.12 level. This is an area that is minor support, so quite frankly would not surprise me at all to see this market continue to drop towards the 1.1150 level over the course of the day today, perhaps even testing the 1.11 level after that. Recently, the highs have started to get lower and lower, and there is even an argument for a potential descending triangle. With this in mind, I don’t have any interest in buying the Euro and I believe that short-term rallies will offer exhaustive candles that we can search selling again. With this, I believe that we will eventually break down and start reaching towards the 1.10 level given enough time.

EURUSD

GBP/USD

The British pound went back and forth during the course of the session on Tuesday, showing a fairly neutral candle. By doing so, it appears that the market is continuing to meander around the 1.30 level. This is an area that although supportive, is quite frankly the beginning of support, and not the actual support itself. I believe that the real support is closer to the 1.2850 level, so we could drift lower from here. Nonetheless, I have no interest whatsoever in buying, and I believe that an impulsive candle is going to be a selling opportunity on signs of exhaustion anyway. With this, I am a seller and am simply waiting for signs of weakness that I can take advantage of which essentially represent “value” in the US dollar.

I do believe eventually we will break down below the 1.2850 level and reach towards the 1.25 level but that’s a longer-term call. Until then, I think short-term selling is probably about as good as this market gets, although those opportunities may be numerous.

GBPUSD

Christopher Lewis

Christopher Lewis has been trading Forex for several years. He writes about Forex for many online publications, including his own site, aptly named The Trader Guy.