EUR/USD
The Euro rallied initially during the session on Friday but continues to find resistance above the 1.1450 level. By doing so, we rolled over to form a bit of a shooting star, and that doesn’t in fact suggest that perhaps we are going to continue to see issues above at the 1.15 handle. That being said, the lows are getting slightly higher and I think we are trying to break out but it might be several days or perhaps even a few weeks before that can happen. In the meantime, I believe we are simply bouncing around between 1.1450 and the 1.1250 level underneath. With the Federal Reserve looking to soften its stance a bit, it makes sense that the Euro may be the beneficiary, but the European Union has its own issues so I think that’s part of what’s going on here.
GBP/USD
The British pound rallied significantly during the trading session on Friday, slamming into the 1.27 level yet again. This is an area that should be resistance, but I think given enough time we will probably find sellers coming into the market in this area, as the 1.27 level was massive support previously. We have a descending triangle that measures for a move down to the 1.22 handle, and I think it’s very likely that we will see another attempt at that level as the Brexit will continue to put bearish pressure on the British pound. This isn’t to say that I expect the market to go straight down, I think it could be very difficult in the meantime, as the market is focus more on the Federal Reserve than it is the United Kingdom, but attention will shift to London rather soon as we have a looming deadline in three months for the divorce.
