EUR/USD
The EUR/USD pair rallied during the course of the day on Monday, testing the 1.10 level above. This is an area that has been massively supportive in the past, the fact that we are starting to see resistance now isn’t much of a surprise. However, I don’t have a sell signal quite yet and I would like to see some type of exhaustive candle in order to start going short again. Ultimately, the market should continue to go even lower and perhaps make a fresh, new low, but at this point in time it’s difficult to imagine that the move will be easy. At this point in time, a rally of any type at this point in time that shows signs of exhaustion will be the way to go short yet again. I have no interest whatsoever in buying and believe that the Euro will continue to fall.
GBP/USD
The British pound initially fell during the course of the session on Monday, but turned around to form a supportive looking candle. That being the case, market looks as if it is ready to go looking for exhaustion above, and I think it will fight it sooner or later. The 1.24 level above and of course the 1.25 level above cause quite a bit of resistance. The first exhaustive candle I see I am willing to sell, and with that being the case I think it’s only a matter time before reach down to the 1.20 level, and then perhaps even lower than that. At this point in time though, it does look like the British pound is trying to stabilize a bit, and I do think that the worst of the selling is done. However, when you look at this market it seems as if it is trying to grind lower, and then should offer plenty of selling opportunities on short-term charts.
