EUR/USD
The EUR/USD pair was very choppy during the trading session on Friday, as we continue to hover around the 1.23 level. I think at this point it’s obvious that we have massive amounts of support underneath, but we have recently broken down below the 50 EMA, and that of course is a negative sign. However, the uptrend line underneath should continue to support this market, and the purple box that I have on the chart also shows a horizontal support that extends down to the 1.21 level. It is not until we break down below that level that I would be a seller. So, in the meantime I truthfully hope that we break down so that I can pick up the EUR on the cheap. That being said, I would need to see the market break above the top of the range for the day on Friday to start buying right now, with an expectation of a short-term pullback being the most likely of scenarios.
GBP/USD
The British pound has gone back and forth during the trading session on Friday, testing the downtrend line that has been so influential over the last several weeks. I think the 1.40 level above will continue to be resistance, but if we break above that level I think we continue to go higher. In fact, I have standing orders above that level to start buying the British pound. Otherwise, I think it’s likely that we could pull back a little bit, as we continue to try to build up enough momentum to go higher. I have no interest in shorting this market, at least not yet. I believe that we are currently trying to build up momentum to break out above that massive resistance barrier.
