The 1.18 level continues to be a very difficult ceiling to break, and I think that’s your theme going forward. I’m not looking for big moves. I just recognize that there is a bit of a ceiling above that the market can’t seem to rise above, and as a result, I think we probably drift a little bit lower in the short term, but again, not a big move.
GBP/USD Technical Analysis
The British pound continues to see the 1.35 level offer quite a bit of resistance, and as a result, I think we’re getting to the top of a potential range as well. Again, keep in mind Monday is going to be a lot more realistic read on the environment than Friday, but it does look a bit like the British pound is trying to do everything it can to top out here.
If we were to break above the 1.36 level, that would open up the floodgates to a move to 1.3750, which is possible, but probably not immediately. As things stand right now, I look at this as a market that is in danger of at least rolling over a little bit. I don’t think we fall apart to the downside either, I just think it’s more likely of two scenarios.
EUR/GBP Technical Analysis
The euro is slightly negative against the British pound, but we’re in a very tight range, have been for five or six days now. Quite frankly, this is a market that continues to look at the 0.8750 level as a bit of a ceiling. The 50-day EMA sits there as well and of course, the pound has been stronger than the euro in general, so this is not a huge surprise. I do think we will eventually go lower here and therefore look at short-term rallies as potential selling opportunities in this particular pair.
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