EUR/USD
The EUR/USD pair broke out during the day on Monday, finally clearing the 1.15 level which had been so resistive. Now that we have done that, it looks as if the market is ready to continue the longer-term move higher, perhaps even offering a “buy-and-hold” type situation. I have been talking about the euro finally break above this level for some time now, and now that we have actually done it, I believe that the market will continue to go higher for the longer-term, reaching towards the 1.18 handle. This was an area that offered quite a bit of support in the past, so it should now offer resistance, thereby making it a magnet for price. I also believe that there is support all the way down to the 1.1450 region, so pullbacks at this point in time will more than likely attract buyers off of short-term setups.
GBP/USD
The GBP/USD pair broke higher during the day on Monday as well, as we did reach towards a fresh, new high, but we pulled back a little bit towards the end of the day. Nonetheless though, I do believe that every time we pull back buyers will be getting involved in this market as it should continue to show quite a bit of enthusiasm. I believe that there is also a bit of a “floor” in this market somewhere near the 1.45 handle, and then eventually we will reach towards the 1.48 level next, which was supportive in the past, and then the 1.50 level after that.
This is generally a market at this point in time that I feel is focusing on the US dollar more than anything else, as the Federal Reserve looks less likely to raise interest rates as quickly as once thought. It is not taking into account the vote for the United Kingdom at the moment in my opinion, which could throw bit of a monkey wrench into the scenario of going higher. The UK is thinking about leaving the European Union, and if it does that will be negative for the Pound, but at this point time I believe that the momentum is firmly in the hands of the buyers.
