EUR/USD, GBP/USD and EUR/GBP Forecasts – US Dollar Continues to Weaken

EUR/USD Technical Analysis

The euro has rallied a bit during the trading session on Wednesday in the early hours, as it looks like we are, in fact, doing everything we can to punish the US dollar. That being said, we are still in the middle of this range. And of course, a week from now, we have the FOMC interest rate decision. And with that being the case, I think we need to see this through the prism of a market that may be trying to test the upside, might be trying to push the Fed into cutting rates, but the Fed’s shown recently, they’re not playing that game. So, expect volatility. I still don’t like buying the euro, at least not quite yet. I’m not quite convinced, although we are getting there.

GBP/USD Technical Analysis

The British pound has broken a pretty significant resistance during the trading session, completely reversing what we’ve seen over the past two days as schizophrenia continues to run the markets. The 1.3350 level is another area of supply that I would be looking at as a potential barrier or place to short.

We’ll just have to wait and see. If you remember, I had talked about this being an area of confluence. It does look like we’re trying to swim upstream. We’ll just have to wait and see whether or not traders truly can push the Federal Reserve into not only cutting rates but also looking like they’re going to see continuous ones.

EUR/GBP Technical Analysis

The euro has pulled back a bit against the British pound, but I do think there’s plenty of support in this neighborhood, and this will more likely than not end up being a buy on the dip kind of short-term trader environment. Ultimately, this is a pair that, based on the measure move, should go to 0.89, but this is one of those pairs that’s very difficult to get any traction in. You can see we normally spend most of our time doing exactly what we’re doing right now, just chopping back and forth. So, with that, I remain positive, but I’m not looking for major moves here.

For a look at all of today’s economic events, check out our economic calendar.