EUR/USD and GBP/USD Forecast
The Euro fell initially during trading on Thursday but found buyers to come in and push higher yet again. The market looks like it is trying to form a bit of a base in this area as we have before, and that’s probably what this mess is all about right now. This is simply an area where traders are trying to figure out what they are going to do next. On one hand, you have a Federal Reserve that’s very soft, but on the other hand you have a European Union that isn’t doing that well. Ultimately, I think it is very likely to see this market chop around in this area and try to build up the necessary momentum to reach the top of the consolidation area which is closer to the 1.15 handle above. If we do break down, the 1.12 level will be massive support based upon previous trading and the 61.8% Fibonacci retracement level.
With a Parliament vote coming, this market gave back some of the gains again on Thursday but we continue to hover around an area that should be somewhat supportive. At this point, I think it’s likely that we will see buyers step back in somewhere in this area, but we haven’t quite got the signal yet to put a lot of money into the market. I think the 1.27 level will be very supportive, and given enough time it’s likely that the buyers would jump in. As long as we don’t have a “no deal Brexit”, I suspect that the pound will be looked at as cheap in these general areas. Expect a lot of sloppy trading, so if you are looking for some type of precision trade, this is not the currency to be bothered with.