The EUR/USD pair broke higher during the trading session on Thursday, clearing the 1.19 level. There is a certain amount of resistance near the 1.1950 handle though, so I think we may pull back in the short term. Longer-term, I believe that the market should continue to go higher, perhaps reaching towards the 1.21 level given enough time. I think that every time we pull back, it’s likely that there is a buying opportunity presented itself, but I would be very cautious about jumping in with both feet, and I believe that the thin trading value will continue to make this market difficult, but I do believe that in the end the buyers are getting ready to push this market much higher. I believe 2018 will be a very good year for this pair, but of course headlines and choppiness will return occasionally.
The British pound rallied during the trading session, breaking above the Wednesday highs during the Thursday bullish session. We have broken above a minor downtrend line, so I think that the market is ready to go higher, but I recognize that the 1.35 level above is resistance, and the short-term target. If we can break above there, the market should then go to the 1.3650 level. A break above that level is a “buy-and-hold” situation just waiting to happen. The uptrend line underneath should offer enough support to keep this market going higher over the longer term, and I do believe that this will be one of the better stories of the year, the rebirth of the British pound as a viable and strong currency. In the meantime, expect a lot of noise and choppiness but I certainly don’t want to sell.