EUR/GBP grinds higher during quiet Thursday session

The EUR/GBP pair has been very noisy, chopping around above the 0.87 handle. The 0.87 level has been important more than once, and it is the bottom of the longer-term consolidation. If we can continue to stay above this area, I think we will eventually find reason to go towards the 0.88 handle. If we break down significantly below the 0.87 handle, the market probably goes down to the 0.86 level. Obviously, this is a market that is very sensitive to the negotiations between the European Union and the United Kingdom, and that of course will continue to offer a lot of headline risk. However, I think that eventually we will find buyers that are necessary in this market and push to the upside.

Even if we do break down lower, I think the 0.86 level is probably even more stringent support than the 0.87 handle, so I would be a buyer in that area. Ultimately, the market should continue to be choppy and noisy, so keep that in mind and keep your trading positions a bit small, at least until we get some type of confirmation of the trade working out. The 0.88 level above should be massively resistive, but if we break above there, the market should continue to go higher. A break above the 0.88 level should send this market to the 0.89 level, possibly even the 0.90 level over the longer term. However, it’s not to be easy so keep that in mind and stay diligent.