Euro falls against the British pound during trading on Tuesday

The EUR/GBP pair had initially tried to rally during the trading session on Tuesday but found the 0.8650 level to be too resistive. We rolled over from there and it now looks as if buyers are coming back in, least in the short term. The market will continue to be very noisy, and I suspect that the 0.86 level underneath is very supportive based upon longer-term charts, so I will be paying quite a bit of attention to it. Because of this, I suspect that it is going to continue to be a short-term type of situation and using some type of range bound system is probably going to be the best way to trade this market.

I am using the stochastic oscillator in the example attached, and you can see that we have found that the breakdown to be a bit oversold, and I suspect because of this we will continue to see more of a grind back and forth, with perhaps a slight downward tilt more than anything else. If we broke above the 0.87 level, then that could change everything, but I don’t anticipate seeing that happen in the short term.

In general, I think that waiting for an opportunity to short this market after signs of exhaustion will continue to be the easier way to play this market, but if you are short-term oriented, you could use the range bound system to your advantage over the next several sessions.

EUR/GBP Video 18.04.18