EUR/USD
The EUR/USD pair fell initially on Friday, but found enough support underneath the 1.17 level to turn things around and form a hammer. Because of this, the market looks likely to continue to find support in this area and therefore I am bullish. I believe that a break above the top of the candle for the session is a nice opportunity to go long, as we should then go to the 1.19 handle. I believe that the market will eventually find plenty of resistance between there and the 1.20 level, but I think that is the longer-term target, the 1.20 level. No matter what happens next, I think you can count on a lot of choppiness but it certainly looks as if the 1.17 level is going to continue to be a major player in the market.
GBP/USD
The British pound went back and forth during the day on Thursday, but more importantly found a bit of support at the 1.2850 level. I think that the market could bounce from here, but the 1.30 level above will be rather resistive. With this in mind, I believe that the market will eventually find some type of trouble over there, so I think a short-term rally may becoming but I would expect the sellers to step in rather quickly. I have no interest in buying, and I believe that a breakdown below the 1.2850 level has this market dropping significantly. Either way, I expect that we will see a lot of volatility, and if we can break down below here we should go looking towards the 1.2650 level which is even more supportive. Currently, I think there’s far too much bearishness and the British pound to consider buying it, and I will do so until we break above the 1.3050 level.
