EUR/USD
The EUR/USD pair has been very noisy during the trading session on Friday, but ultimately we ended up forming a bit of a hammer, perhaps even a neutral candle. I’m not sure where we go next, but if we can break above the top of the candle, then we could go to the 1.21 handle above. A breakdown below the bottom of the candle on the Friday session probably sends this market down to the 1.18 level underneath. The 1.17 level is essentially the “floor” in the market, and I think it’s not until we break down below there that you should worry about the overall uptrend. This is a market that I think that longer-term goes much higher, but of course we have a lot of volatility due to news events coming out of the European Union losing the United Kingdom, and all that comes with that.
GBP/USD
The British pound went back and forth during the day, finding the 1.35 level to be far too resistive. Now that we have broken down below there, and looks likely that we will go down to the 1.3333 level, which was previous resistance, and should now be supportive. I think that a pullback is likely to find plenty of buying pressure in that area, and I think that a bounce is likely. I would love to buy the British pound closer to the level, but I also recognize that if we break above the 1.3650 level, that is a longer-term buying opportunity, as the market then becomes a “buy-and-hold” scenario. I have nothing at this point in the thought process that tells me we should be selling the British pound as it has been so strong.
