EUR/GBP Forecast August 10, 2017, Technical Analysis

The EUR/GBP pair fell a bit during the day on Wednesday, reaching down towards the 0.90 level. The market has seen support there in the past, and I think that we could bounce from here and reach towards the 0.91 handle. A break above there is likely, but it may take some time to get that in action. Once we break above the 0.91 handle, the market should then go to the 0.92 level. A breakdown below the 0.90 level would be negative, but not necessarily catastrophic. I believe that the market still prefers to buy this pair rather than selling, mainly because of the negotiations between the United Kingdom and the European Union. There are far too many questions around the United Kingdom and what the economy will look like after the divorce proceedings, so I believe that most traders are more comfortable going long.

Buying dips

Overall, a “buy the dips” strategy should continue to be preferred in this market. I think that the market may be a bit choppy and volatile, but given enough time it’s likely that we will not only reach towards the 0.92 level, but perhaps even 0.95 and then parity over the longer term. It’s hard to tell what’s going to happen next, and of course there are a lot of headlines that could change things in an instant. This could be a very difficult market to train over the next several months, but it will certainly be lying only occasionally as headlines cross the wires.

EUR/GBP Video 10.8.17