EUR/USD
The euro rallied against the US dollar during the day on Friday, reaching above the couple of shooting stars. Because of this, the market will more than likely continue to try to reach above the 1.10 level, but I see quite a bit of resistance there. Quite frankly I would love to see some type of exhaustive candle that I can start selling, as we are in a downtrend and obviously there is a lot of previous support at the ferry which should now be rather negative resistance. The candle is fairly strong though, I have to admit that but I would also point out that a majority of the gains were late Friday in low-volume after it was announced by the FBI that they were reopening the case against Hillary Clinton, and it through a bit of a monkey wrench into the markets overall.
GBP/USD
The GBP/USD pair initially fell during the course of the day on Friday but turned around to form a bit of a hammer. I still think that there’s quite a bit of bearish pressure in this market, so quite frankly any rally at this point in time should be a nice selling opportunity. I would look for exhaustive candles above in order to take advantage of “value” in the US dollar, and I think it makes sense that we need to bounce several times in order to build up the necessary momentum to break down below the significant 1.20 level.
Any signs of exhaustion above will be a nice selling opportunity in my estimation as the downtrend is so strong and quite frankly I don’t see any reason for the fundamentals of this pair to change anytime soon. Granted, I don’t think that the British pound will continue to sell off rapidly, but I do think a general decline in the currency is still in the cards, at least for the near term.
