EUR/USD
The Euro initially tried to rally during the day on Tuesday, showing signs of resiliency, but then rolled over to continue to go lower. I think that the 1.13 level prediction that I made is probably coming true in the short term, and I even have friends in the analyst community that are now starting to suggest we could go as low as 1.05. Regardless, at this point I think that the 1.15 level should continue to offer significant resistance, so I think rallies are to be sold on short-term charts, that’s probably the easiest way to trade this market. Clearly, there is still a lot of concern about the Turkish lira causing problems with the European banking system still. If we did break above the 1.15 handle, I think then we need to see if the market can close above there on a daily chart to think about buying it.
GBP/USD
The GBP/USD pair initially try to rally, and broke through some resistance, but then turned around to break down even further, making a fresh, new low. I think at this point, we are likely to break down below the 1.27 handle, and then perhaps reaching down to the 1.25 level next, which would be psychologically and structurally important. On the alternate side of that coin, if we were to break above the highs from the Tuesday session, then I think we go looking towards 1.30 level above, which should be rather important and resistive as well. Until we get some type of announcement of a deal between the UK and the EU, it’s likely that this pair will continue to see a lot of selling pressure in continuum.
