EUR/USD, GBP/USD and EUR/GBP Forecasts – Dollar Gives Back Some Gains During Early Friday Trading

EUR/USD Technical Analysis

The Euro has rallied just a touch during the early hours here on Friday as the selling looks like it’s slowing down a bit. That makes a certain amount of sense with the 1.16 level, maybe adding a little psychology to the level. But we’ve been negative for so long, I’m still looking at rallies at this point in time as shorting opportunities. I think that we are still very much in a trading range and happen to be right around the middle of it. So we’ll have to wait and see how this plays out.

That being said, if we were to break above the 1.17 level, then we have to be very quick to observe signs of exhaustion as potential shorting opportunities.

GBP/USD Technical Analysis

The British pound has bounced only to turn around and show signs of hesitation near the 1.34 level. We’ll have to wait and see if there is continued downward pressure. I think there probably will be. But again, it’s Friday. Maybe people are just closing out positions for the week. Perhaps it’s just a little bit of a recovery after a couple of really ugly candlesticks this week. We just don’t know yet.

I do think that the British pound is stronger than the Euro, but I think the US dollar is going to continue to be stubbornly strong as the Federal Reserve looks very unlikely to start cutting rates aggressively.

EUR/GBP Technical Analysis

The Euro continues to be very noisy against the British pound, but it did have more of a negative feel during the Friday session. We continue to consolidate right here at the 200-day EMA, which probably shouldn’t be a major surprise. After all, it’s an area that a lot of technical traders will be watching.

But if we break down below the 200-day EMA, the 0.86 level is your next target. If we break down below there, then we look at 0.8550. Short-term rallies, I believe, offer selling opportunities unless we rally above the 0.8750 level, something that I don’t think happens very easily.

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