EUR/USD
The EUR/USD pair went back and forth on Tuesday, showing signs of volatility still. I believe that the 1.17 level underneath offers support, and I think that we will more than likely bounce from here. I think the market could then go to the 1.20 level above, which has been resistive. If we break down below the 1.17 level, the market should then go down to the 1.15 level underneath. Once we broke above the 1.15 level, the market looks as if it was going to continue to reach towards the 1.25 handle. I think a pullback to the 1.15 level should find plenty of support, and therefore I think the market could find plenty of buying pressure in that area. I think that we are a “buy only” market, and now it’s a question whether we can buy on a break above the 1.18 level, or a pullback to the 1.15 handle.
GBP/USD
The British pound fell slightly during the day on Tuesday, as we continue to reach towards lower levels. I think the 1.32 level underneath should offer support, as it was resistance in the past. The pullback to this level should be a retest of the previous resistance, and I think that the buyers will more than likely return sooner rather than later. Because of this, I am a buyer of any signs of support and of course impulsive candle. If we were to break down below the 1.32 handle, then I think we will probably try to find support at the 1.30 level below, which has been important over the longer term, and of course is a large, round, psychologically significant number. With this in mind, it’s only a matter of time before the buyers would return. If we were to break down below the 1.30 level, that would be extraordinarily negative.
