EUR/USD, GBP/USD and EUR/GBP Forecast – US Dollar Fighting Back on Tuesday

EUR/USD Technical Analysis

The euro continues to see trouble just above, and ultimately, as the market’s rallying continues to bring in selling pressure. The 50-day EMA is sitting above and is offering a significant amount of resistance. The downtrend line, of course, comes back into the picture. All things being equal, this is a market that I think continues to be noisy, and I do think it continues to favor the US dollar over the longer term, as the US dollar is starting to see a lot of inflows and there are a lot of concerns about the overall global economy. All things being equal, the 1.14 level underneath is, I think, your target. It is not until we break above the 1.17 level that we start to look at the possibility of a continuation of the previous uptrend.

GBP/USD Technical Analysis

The British pound initially tried to rally during the trading session on Tuesday as well, but then gave back gains and showed a potential shooting star, and therefore, I think we have a real possibility of a drop from here to reach down to the 1.130 level. The 50-day EMA looks as if it is going to cross below the 200-day EMA, kicking off the so-called death cross. The 1.32 level above is significant resistance and 1.30 underneath is support, so we are in a range, but this could, and I believe is going to be, a continuation pattern. So we will just have to see how long it takes for the market to make its next move.

EUR/GBP Technical Analysis

The euro has gone back and forth against the British pound, and therefore, I think we have a situation where it is going to be very noisy. The 0.8750 level above is a significant resistance barrier, but I think it is also a significant support pair now that we are above it. The 50-day EMA does offer support as well. I think dips allow you on this pair to simply pick up a little bit of value and continue to go to the upside. If we were to break down below the 0.8750 level, then we may have to retreat to the 0.87 level, but at this point in time, I think there are plenty of buyers right around the 50-day EMA that will keep this market supported.

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