EUR/USD
The Euro initially fell to kick off the week, but then turned around to show signs of life again. After forming a hammer from the previous week, I believe that the Euro is going to recover and try to go towards the 1.15 handle, which is the next major resistance level. The daily candle was a bit of a hammer, and now that we have broken out a little bit it looks like we could continue to go a little bit higher. The 1.15 level was previous support, so I assume that there will be some order flow there. Beyond that, the 1.16 level could be targeted, but at this point I am looking at this more or less as a reprieve, not necessarily a trend change. There are far too many issues in Turkey right now to think that we have forgotten about it completely.
GBP/USD
The British pound initially pulled back a little bit, but then rallied to reach towards the 1.28 handle. The shooting star that formed several days ago being broken to the upside would be a very bullish sign, and I think at this point would send this market towards 1.30 level after that. I think that the market could rally, but in the end should offer a nice selling opportunity above on signs of exhaustion. At this point, I would not be a seller, but I don’t have any interest in buying either because there are so many concerns about the Brexit, and of course those headlines can come into the fold at any moment. I think at this point, this is more or less a relief rally than anything else.
