EUR/GBP Forecast June 16, 2017, Technical Analysis

The EUR/GBP pair went sideways initially during the day on Thursday, but then started falling to reach towards the gap below. The gap below of course is a very fermentable target for the trading community at large, and therefore I think that it’s only a matter of time before we try to fill that target. However, we will more than likely get bounces from time to time, and I recognize that the 0.88 level might offer a bit of resistance. Because of this, I’m looking for some type of exhaustion to start selling. Alternately, if we can break down below the massive candle on the hourly chart, I believe that the sellers will then get their opportunity to fill that gap. I suspect that this opportunity will present itself in a relatively short amount of time, so I anticipate that the market will try to do this over the next two sessions.
Brexit
The noise continues around the idea of the British leaving the European Union, and because of this I think that the markets are going to deal with a lot of noise as headlines go back and forth across the English Channel. With this being the case, I anticipate that the market will be rather choppy, but right now it appears that a lot of the volatility is due to the EUR itself, and with that I think it is yet another reason to think that this market falls apart. Keep in mind that the PIP value in this market is stronger than most other markets, so having said that this move could be rather large even though it doesn’t look like that. With this, I am bearish and have no interest in trying to fight filling the gap below.