EUR/USD
The EUR/USD pair went back and forth during the session on Thursday, as the 1.0850 level below offered quite a bit of support, but there is most certainly quite a bit of resistance above. Ultimately, I believe that sooner or later this market will continue to show bearish pressure and I believe that given enough time that’s exactly what’s going to happen, we will break down. However, I think that we may need to see quite a bit of exhaustion after short-term rallies to turn things around. I believe that the 1.10 level above is massively resistive, and I don’t think we are going to break above that very soon. Given enough time, I expect this market to reach to the 1.05 level below.
GBP/USD
The British pound actually rallied during the session on Thursday. This was a bit of a departure, as we tried to rally Wednesday but gave back all of the gains. Now that we have cleared the top of the shooting star from Wednesday, I believe that we will more than likely reach higher, perhaps towards the 1.2850 level above. With that, the market could be a short-term buying opportunity but given enough time I do think that the 1.2850 level above will be massively resistive. We are still having a lot to worry about when it comes to the exit vote out of the United Kingdom, so I believe that sooner or later we will have the bearish pressure that will turn this market around. A break down to the 1.20 level is still what I expect to see longer-term. I have no interest whatsoever in buying this pair at this point, unless of course was for a short-term “smash and grab” type of trade. This is a market that could turn around fairly soon, but we still have a lot of things to worry about.
