The EUR/GBP pair had a very negative session on Tuesday, breaking below the 0.80 handle yet again. The shooting started formed on Monday of course was the first sign that the market was about to fall apart, but what I believe is truly driving this market is the British pound itself, not necessarily some kind of concern with the Euro. After all, the EUR/USD pair did in fact shoot straight up during the session, but the GBP/USD pair has broken above significant resistance on the longer-term charts, which means that the British pound should be free to go much higher in general. I believe that this move in this market is simply a function of that.

I’m not ready to quite start selling yet, as this market has a little bit of support just below, and I think a move below the 0.7950 level is in fact that the “green light” to start selling again and aiming for much lower levels. In fact, I believe the 0.75 level is where this market is getting ready to go, but it will take quite a bit of time to get down there obviously. On top of that, this pair tends to move very slowly, but keep in mind that the pip value is much higher as well. In other words, you don’t need as big of a move to make money.

Don’t fight the trend.

The candle is very strong looking for the sellers, and as a result I think that there will be continued pressure. After all, we did manage to close at the very lows of the day, so this means that there should be plenty of selling pressure today as well. With that, I think that a breakdown is imminent, and it should be a nice move waiting to happen, but it is not until we close below the level that I’m willing to actually risk trading capital. Ultimately, I will not fight this trend as it is obviously in favor of the British pound, and I think any bounce from here should be a nice selling opportunity.


Related Articles
  1. Retirement

    Suddenly Pushed into Retirement, How to Handle the Transition

    Adjusting to retirement can be challenging, but when it happens unexpectedly it can be downright difficult. Thankfully there are ways to successfully transition.
  2. Mutual Funds & ETFs

    The Democratization of the Hedge Fund Industry

    The coveted compensations of hedge fund managers are protected by barriers of entry to the industry, but one recent startup is working to break those barriers.
  3. Investing

    What a Family Tradition Taught Me About Investing

    We share some lessons from friends and family on saving money and planning for retirement.
  4. Retirement

    Two Heads Are Better Than One With Your Finances

    We discuss the advantages of seeking professional help when it comes to managing our retirement account.
  5. Financial Advisors

    Tips on Passing the CFA Level I on Your First Attempt

    Obtain valuable tips and helpful study instructions that can help you pass the Level 1 Chartered Financial Analyst exam on your first attempt.
  6. Professionals

    The Best Financial Modeling Courses for Investment Bankers

    Obtain information, both general and comparative, about the best available financial modeling courses for individuals pursuing a career in investment banking.
  7. Stock Analysis

    These are Twitter's 4 Biggest Bets for Next Year

    Looks at Twitter's plans for 2016 under CEO Jack Dorsey, who has returned to lead the company he founded seven years after he was replaced.
  8. Investing Basics

    Why Interest Rates Affect Everyone

    Learn why interest rates are one of the most important economic variables and how every individual and business is affected by rate changes.
  9. Entrepreneurship

    Top 5 Billionaires Living In Dallas

    Learn who the richest of the rich are in a city known for creating some of the world's wealthiest people, and read how they amassed their vast fortunes.
  10. Credit & Loans

    Best 3 Online Auto Loan Calculators that Include Tax

    Learn where you can find the best auto loan calculators online that include sales tax, and understand the different features these calculators offer.
  1. Are secured personal loans better than unsecured loans?

    Secured loans are better for the borrower than unsecured loans because the loan terms are more agreeable. Often, the interest ... Read Full Answer >>
  2. Is Israel a developed country?

    Israel is considered a developed country, although it has substantial poverty and large income gaps. The International Monetary ... Read Full Answer >>
  3. Can personal loans be included in bankruptcy?

    Personal loans from friends, family and employers fall under common categories of debt that can be discharged in the case ... Read Full Answer >>
  4. How many free credit reports can you get per year?

    Individuals with valid Social Security numbers are permitted to receive up to three credit reports every 12 months rather ... Read Full Answer >>
  5. Is the Wall Street Journal considered to be a conservative publisher?

    The Wall Street Journal is controlled by Rupert Murdoch via Dow Jones Publications, which in turn is owned by Murdoch's News ... Read Full Answer >>
  6. Is Spain a developed country?

    Spain is a developed country. Nearly all organizations that analyze development status classify it as such. Spain has a strong ... Read Full Answer >>

You May Also Like

Trading Center