EUR/USD
The EUR/USD pair initially tried to rally during the Wednesday session but turned around to continue the consolidation near the 1.09 handle. I look at this chart in the first thing that I notice is the massive gap from the Monday session, which of course should be supportive longer term. However, it’s common for the market to turn around and try to fill those gaps, meaning that we may get short-term bearishness. If that’s the case, I’m not willing to sell this market although I recognize that short-term traders may be able to. I would rather see some type a supportive candle, especially near the 1.0750 level to take advantage of what looks to be an uptrend in channel longer term.
GBP/USD
The British pound continues to go back and forth during the session on Wednesday, as we consolidate after making the massive breakout. We are still above the 200-day exponential moving average, and longer-term traders look at that as a bullish sign. We could grind for a little while here, but I think that the buyers will return. We did make a little bit of a new high during the day, Lisa’s far as the last several sessions are concerned. Because of this, I believe that the bullish pressure is starting to build up, and it will take over.
I believe that there is a significant amount of support at the 1.2750 level below, and because of this I have no interest in shorting. When I look at the longer-term charts I recognize that the consolidation area that we have just moved into has resistance at the 1.3450 level above ultimately, and that should continue to be a target longer-term from what I see. I think it is going to be very choppy, but nonetheless I do think that we go higher.
