EUR/GBP forecast for the week of August 7, 2017, Technical Analysis

The EUR/GBP pair initially fell during the week, but found enough support just above the 0.89 handle. Ultimately, the market managed to break above the 0.50 level, and it looks likely that the market is going to go looking towards the 0.92 handle above which was the massive resistance that we have seen last year. I think that short-term pullback should be buying opportunities, and that given enough time if we break above there the market should continue to go towards the 0.95 handle. Ultimately, the market is bullish but I recognize that the jobs number on Friday May thrown a bit of a monkey wrench into the entire situation.

Last week’s hammer

Last week’s hammer tells me that there is plenty of bullish pressure, and the fact that we break above there and the psychologically important 0.90 level suggests that we are going to continue to see this market grind to the upside. It doesn’t exactly explode very often, so you may have to be patient on this move, but I do think that the buyers are starting to take over. Pullbacks offer value, and I believe that the 0.89 level below will be a massive floor. Below there is the 0.88 handle, and if we can stay above that I believe that the uptrend is very much intact, even if we do get a bit of a pullback based upon value. This could end up being a nice “buy-and-hold” type of market although there will be noise flowing into it from the negotiations between the United Kingdom and the European Union as far as the exit is concerned. Those pullbacks that occur will more than likely be looked at as value that people will take advantage of.

EUR/GBP Video 07.8.17