EUR/USD
The Euro gapped lower initially during the trading session on Monday to kick off the week, but then rallied towards the 1.16 level above. That’s an area that has been resistance a couple of times last week, so I think that if we can break above the top of the candle stick for the trading session on Monday, then we should continue to go much higher, reaching towards the 1.17 level. Ultimately, I do think that there is a significant amount of support underneath at the 1.15 handle, so even if we do pull back a little bit from here I think that value hunters will come back rather quickly. Expect a lot of choppiness in short-term trading overall, so at this point I think that you will need to consider shortening your positions and most certainly tighten your stops as there are a lot of concerns around the world and of course the risk appetite fluctuations around the world are not helping.
GBP/USD
The British pound gapped lower to kick off the week but rallied enough to fill that gap. Overall, I think that the market continues to be bullish longer-term, but it’s obviously a market that is worried about several different facets of the Brexit. We are getting close to a solution, whether it be a Brexit deal or a “no deal exit.” Ultimately, I think at this point it’s likely that the market will eventually rally based upon certainty if nothing else. The 1.30 level should continue to be support, and I think it’s not until we break down below that level that you should start to worry about the overall efficacy of any type of British pound rally. I look at this market as one that continues to be very difficult, mainly because the crosscurrents of fear continue to push all markets around.
