EUR/USD
The Euro initially pulled back during trading on Monday to kick off the week but then rallied rather significantly later in the day. At this point though, the market still doesn’t know really what it wants to do but as we are closer to major support than major resistance, it makes sense that we would get a little bit of a bounce. I believe that the 1.1325 level above will continue to offer a bit of resistance though, so keep in mind that the upside might be somewhat limited, at least in the short term. This is usual chop fest type of trading that we see in this pair, so it’s a bit difficult to get overly excited one way or the other. If we do break above the 1.1325 handle, then we could go looking for another 100 pips or so. If we break down through the 1.1150 level, then it’s likely that we could break down towards the 1.11 handle, and eventually the 1.10 level after that.
GBP/USD
The British pound has done very little during the trading session on Monday, as we are dancing around the 1.30 level. The support extends down to the 1.2950 level, as the area has been a thick support barrier supporting the descending triangle that I have marked on the chart. Based upon the triangle, we could probably go down towards the previous downtrend line, which should offer support. The market simply has no reason to rally significantly, as the Brexit has been put on hold. Quite simply, it’s not until we get some type of clarity that the British pound will be able to rally for the longer-term.
