EUR/USD and GBP/USD Forecast - 22 May 2019
The Euro went back and forth rather wildly during the trading session on Tuesday as investors try to figure out what they’re going to do next. There are so many moving headlines right now that of course it moves the US dollar rather drastically, which of course causes quite a few problems. With that being the case it’s no surprise that we continue to find ourselves dancing around the 1.1150 level without any clear direction.
Keep in mind that this market is essentially going back and forth between 1.12 on the top and 1.11 on the bottom. There is a 50 pip range of resistance above the 1.12 handle, so I think that keeps this market pretty muted. If we can break down below the 1.11 level, then the market will probably go down to the 1.10 level rather quickly.
Well, it was only a matter of time before we got more Brexit headline nonsense. The latest bit was about Theresa May having backing from her cabinet, but then suggested a possible second referendum, only if parliament accepted her deal for the fourth attempt. Quite frankly, this was probably more machine trading than anything else we find ourselves just simply sitting at the 1.27 level and trying to figure out what to do.
As this market is so heavily traded by algorithmic news feed readers, and there are going to be noises around the wires going forward, it’s likely that we will continue to be better off staying away from this pair. If we do break down, and let’s face it that’s a very real likelihood, the 1.25 level would be the next major support level underneath. If we break above the 1.2750 level, then this market could continue to go higher.