EUR/GBP Price Forecast November 17, 2017, Technical Analysis

The EUR/GBP pair went sideways initially during the day on Thursday, but then rallied towards the 0.8970 handle. The market pulled back from there, after forming a shooting star on the hourly chart, and then fell towards the 0.89 level underneath. The level should offer support, and I’m looking for some type of bounce to take advantage of. However, if we break down below the 0.89 level, it is just more of the same that we have seen lately: consolidation between the 0.88 level on the bottom, and the 0.90 level on the top. The volatility will continue, as the 2 economies are so highly intertwined, and of course there will be a lot of headlines coming out of both London and Brussels with the breakup. I think that overall, people will feel much more comfortable investing in the European Union, as there are far too many questions about the United Kingdom.
Longer-term chart suggests that they move above the 0.90 level could send this market looking to the 0.93 level after that, and I believe that is the most likely scenario. As we pull back like we have, that should offer buying opportunities, and is not until we break down below the 0.88 level that I would consider shorting, or even be remotely concerned about the uptrend. However, I recognize that short-term traders may want to take advantage of this overall consolidation, so a shorting opportunity has presented itself for those nimble enough to deal with it. However, as I record this it looks like the market is trying to find its footing, so we may not even get that opportunity. Overall, I remain bullish, but also recognize that the European Union has enough trouble in its own right going forward.

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