EUR/USD
During the day on Thursday, the EUR/USD pair initially tried to rally, but turned back around near the 1.0950 level. Because of this, the market ended up forming a bit of a shooting star, and having said that it appears that the market is ready to continue to go lower over the longer term. The 1.08 level below is supportive, but ultimately this is a market that has been very negative overall. If we can break down below the 1.08 level, the market should then reach down towards the 1.07 handle. After all, this is a market that has been grinding away sideways with a slightly negative tilt lately. On the chart, you can see that the 100 day exponential moving average has acted as dynamic resistance. I believe selling is the only thing that you can do, but quite frankly I don’t have any real interest in doing that as I see quite a bit of choppiness ahead.
GBP/USD
The GBP/USD pair went back and forth during the day on Thursday and essentially formed a neutral candle. The neutral candle suggests that the market could bounce from here, but there is a significant amount of resistance at the 1.45 level and of course the 1.46 level above there. I am simply waiting to see some type of resistive candle to start shorting again after a short-term rally. It may or may not appear on the daily charts, so it may take a shorter timeframe type chart to take advantage of that. On the other hand, if we break down below the bottom of the hammer from Tuesday, the market should continue to go much lower as it is a fresh new low.
I don’t have any real interest in buying this pair the moment, and believe that any rally will of course attract value hunters when it comes to the US dollar.
