EUR/GBP turns around during Thursday session

The EUR/GBP pair has broken down a bit during the trading session on Thursday, breaking below the 0.87 handle. This is an area that has previously been supportive, and now that we have bounced back towards it, it should show signs of resistance. If we can break down below the 0.8680 level, then I think the market probably unwinds back to the 0.86 handle. That is an area that is important on longer-term charts, but I suspect that we will probably break down below there as well, perhaps reaching towards the 0.83 level as it looks like the Bank of England is going to raise interest rates regardless of deflationary concerns.

The alternate scenario is that we can break above the 0.8740 level, and then perhaps sending the market towards the 0.88 level after that. It would take a lot of momentum to make that happen now though, but when I look at this chart I can make an argument for either direction, as it looks as if we try to form some type of bottoming pattern. Ultimately, I believe that we will get an answer to our questions rather soon, but right now I have those couple of levels that I’m paying attention to and will place my trades accordingly. Between now and then, I think it is very difficult to do much with a market that appears to be confused to say the least.

EUR/GBP Video 20.04.18