Yahoo Finance Euro rallies against British pound during the session on Monday
This is a pair that continues to be very noisy, based upon the negotiations between the United Kingdom and the European Union. Beyond that, both of these currencies are generally soft, as you can see by paying attention to the benchmark currency, the US dollar. Both have been falling as of late, so this is essentially a battle between two lightweights. Quite often, these are the most choppy and difficult markets to deal with, because there’s no real reason to own one currency over the other.
I believe that the 0.88 level above will cause a significant amount of resistance though, as it has been supportive in the past. I prefer selling in general, because the Euro has been weaker against the US dollar than the British pound. Ultimately, I think in the short term we may see a bit of a pop, but it might also offer selling opportunity. We have a lower low, and that of course is a negative sign as well. I think that if we roll over from here, it’s likely that we will continue to go down to the 0.87 handle, and then perhaps even the 0.86 level after that which has been important on the longer-term charts. Although I think we might get a short-term rally, I prefer selling signs of exhaustion over anything else as it seems like the sellers have been rather aggressive every time they have gotten an opportunity.
EUR/GBP Video 22.05.18
This article was originally posted on FX Empire
