The EUR/GBP pair has been very noisy over the last couple of sessions, as we continue to bounce around the 0.8650 level, and the 0.87 level above is massive resistance. I think that is essentially the “ceiling”, and I think it’s not until we get above there that I would be comfortable buying. After all, we have recently broken down below that level, which was once massive support. Now that we are below it, the resistance should be rather stringent there as well. I think regardless of what happens, it’s going to be very noisy, so I think that we will probably be best using some type of range bound system and perhaps small position size to take advantage of this little area that we have been trading in. Longer-term, I suspect that we are going to go lower, perhaps down to the 0.86 handle after that. A breakdown below there could open the door to the 0.85, but the 0.86 level has been important on longer-term charts, so I suspect that it will take a bit of effort to break down through it.
Alternately, if we broke above the 0.87 handle, I think it’s likely that we would try to go to the 0.8725 handle, and then if we can break above there I think that the market should continue to go to the 0.88 level after that, which has been important more than once. While a bit of caution is advised, I think those who are nimble could benefit from this market.
EUR/GBP Video 16.04.18
This article was originally posted on FX Empire
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