EUR/USD
The Euro fell hard during the trading session on Thursday, as the 50 day EMA has offered a significant amount of resistance. However, there is massive support underneath so I’m looking for an opportunity to start buying. It may not be in till Monday, but as we approach the blue rectangle underneath, there should be plenty of buyers. The 1.12 level remains the “floor” in this market, so I would be a bit surprised if we break down below that level. I think that you should be looking for value, as we are at the lower part of the overall consolidation, that extends all the way to the 1.15 level. We have been drifting a bit lower overall, but the 1.12 level has been so resilient that I think there are still buyers waiting in that general vicinity.
GBP/USD
This is probably the most dangerous currency in the world to trade right now. This is because we have so many different headlines happening at any given moment involving the Brexit that we are seeing massive swings in both directions. Overall, I am still a buyer of dips but I am very cautious about putting a lot of money into the pair as of late. The 1.35 level above is the target on a breakout, just as the 1.30 level underneath is massive support. I think we continue to undulate between now and March 29, which of course is the deadline for the United Kingdom to leave the European Union.
Ultimately, I think we have broken through a major downtrend line, but obviously things can change in an instant with the wrong headlines. All things being equal I continue to buy the British pound but I do so cautiously. I look for value or dips to take advantage of.
