EUR/GBP Price Forecast November 16, 2017, Technical Analysis

The EUR/GBP pair broke out towards the 0.90 level during the day on Wednesday, but then pulled back rather stringently. Because of the action that I have seen over the last 24 hours, I believe that we are going to continue to consolidate between the 0.90 level on the top, and the 0.88 level on the bottom. I expect a lot of volatility, but quite frankly that should not be a surprise as we have seen so much in the way of headlines crossing the wires about the divorce of the UK from the European Union, and of course that’s a very fluid situation. Longer-term, I still believe in the uptrend, and because of the more certain condition in the EU than we get in the UK, but I think we will continue to be very noisy, and therefore it should continue to be a very dangerous market.
If we break down below the 0.8933 level, I believe that selling is possible, but again is a short-term type of situation. Alternately, if we break above the 0.9020 level, then we probably go much higher, perhaps the 0.93 level after that. Ultimately, this is a market that continues to be very noisy, and I don’t see a change in that anytime soon. If we were to somehow break down below the 0.88 level, that would be a very negative sign, and would change the attitude of the markets in general. However, I suspect that isn’t going to happen anytime soon, and therefore I remain bullish in general, but I also remain cautious and will use smaller trading positions than usual. I still believe that we could eventually see parity, but that is several months away to say the least, as we sort this mess out.