EUR/USD
The EUR/USD pair went back and forth during the day on Thursday, testing the 1.09 level for resistance, and the gap below for support. If we can break down below the bottom of the candle for the session on Thursday, I feel that we will continue to fall and trying to fill the gap that formed after the French poll results suggested that they were going to elect a centrist government. However, the gap has not been filled, and I think that given enough time, that’s exactly what’s going to happen. I would also expect the 1.0750 level to be massively supportive, so having said that I think this is a short-term selling opportunity. Alternately though, if we break above the 1.09 level, I think that is an extraordinarily bullish sign and should send this market to the 1.10 level after that.
GBP/USD
The British pound fell significantly during the day on Thursday, after the Bank of England suggested that it wasn’t as hawkish as some people thought. The uptrend line that I have marked on the chart should continue to offer support though, and the fact that we bounced off there is a very bullish sign. I think that there is a lot of support all the way down below, all the way down to the 1.2750 level. A supportive candle is a sign that we should start going long again, and a break above the 1.30 level should send this market reaching towards the 1.3450 level above. I have no interest in shorting, I believe that the British pound breaking above the 1.2750 level was a significant move, and that of course has been noticed by everybody in the currency markets. If we did breakdown below there, things would change, but until then I still believe the buyers are going to be in control.
