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EUR/GBP Price forecast for the week of November 6, 2017, Technical Analysis

Christopher Lewis
Updated

The EUR/GBP pair initially fell during the week but found support underneath the 0.88 handle. Part of this may have been due to Mark Carney suggesting that the Bank of England, although it raised interest rates, isn’t likely to do so in the short term. Because of this, the British pound has struggled a bit, and it looks likely that we may continue to see the British pound selloff in the near term. On this chart, I recognize the 0.90 level as the target, which has been important in the past. If we can break above there, the market should then go to the 0.93 handle over the longer term. We have been in an uptrend for some time, so I think that is ultimately what happens. However, I believe that the market may consolidate in the short term, due to the exhaustive candles that we have seen on the weekly chart recently.

If we were to break down below the bottom of the hammer from the previous week, we could drop to the 0.83 level, but the strength that we have seen and of course the change of attitude with the British pound, it’s likely that we will continue to go to the upside. If we did breakdown, it would probably be a rather quick move lower. I would expect to see a massive amount of support at the 0.3 level, perhaps offering a longer-term “buy-and-hold situation.” Overall, I think that a lot of traders are looking to reach the parity level, but obviously it’s going to take a lot to get there. Remember, this pair has a much larger PIP value, and therefore a smaller position can be used for these longer-term opportunities and potential investments.

EUR/GBP Video 06.11.17

This article was originally posted on FX Empire

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