EUR/GBP Forecast June 23, 2017, Technical Analysis

The EUR/GBP pair went sideways, as we continue to see support at the 0.88 handle. It looks as if the market is trying to build up enough momentum to finally going higher, but I don’t think that it’s going to be easy to do. On top of that, we have the negotiations involving the European Union and the United Kingdom, and that will continue to cause a lot of headlines that will move this market back and forth. Ultimately, the market will be prone to sudden moves, so therefore you should be very careful with your position size. Nonetheless, it looks as if the uptrend should continue to be going forward, and that should be an opportunity for traders to build up position size over the longer term. Obviously, the headlines will control what happens next. But there is a massive gap below that still has not been filled, and that suggests that there is the possibility of violent pullbacks. However, that gap also suggests a lot of buying pressure underneath.
It is because of the choppiness that I believe this is a “add as you go” type of situation, and that continues to be the best way to play this market, simply adding as you make profits, but slowly as you may wake up one day with a sudden turnaround of 100 points against you. Because of that, if you have the ability to trade small, or better yet even use options, that might be the best way to deal with what is almost undoubtedly going to be a lot of noise and volatility in what is the epicenter of the entire Brexit negotiations.