EUR/USD
The EUR/USD pair initially tried to fall during the course of the day, but as you can see found support later during the session and rallied a bit. However, I think there is still quite a bit of resistance above, and ultimately I am a seller over the longer term. I’m looking for an exhaustive candle in order to start shorting, and believe that the 1.12 level above will continue to be a bit of trouble for buyers. I do recognize that the 1.10 level below is massively supportive, so expect volatility no matter what happens next. I think that perhaps the Federal Reserve can’t raise interest rates is much as once thought, but quite frankly the European Union isn't exactly where you are going to find yield either.
GBP/USD
The British pound broke down during the course of the day on Tuesday, slicing through the 1.30 level at one point. However, we turned around to form a bit of a hammer, and that of course is a bit of a bullish sign. I think that a rally is probably coming, but it is going to be short-term at best. I would prefer to sit on the sidelines and wait for an exhaustive candle in order to start selling yet again. I recognize that there is a lot of support just below, extending all the way down to the 1.28 handle. Because of that, I think rallies will have to continue to happen from time to time on short-term charts in order to build up enough momentum to finally break down significantly. At this point in time, I have absolutely no interest whatsoever in buying the British pound, because quite frankly this just far too much in the way of uncertainty when it comes the United Kingdom at the moment. With this, I am patiently waiting to sell yet again.
