The Euro fell again during trading on Friday as we continue to see weakness in the European Union. The market has broken significantly below the 1.17 handle, and now looks like it will go looking towards the 1.1550 level underneath, which is a complete retrace of the entirety of the bullish move that we have seen over the last several months. Once we break down below the 61.8% Fibonacci retracement level, it makes sense that we would wipe out the entirety of the move as it is more than likely going to be the outcome anyway. I think that short-term rallies continue to offer selling opportunities as the US dollar continues to strengthen in general. With rising interest rates in America, and of course a lot of concerns when it comes to the Italian bond market and makes sense we continue to go from upper left to lower right.
The British pound is fallen again during the day on Friday, reaching towards 1.33 level. This is an area that I anticipate seeing a bit of resistance based upon market structure in the past, but eventually we will break down below here and go looking towards the 1.30 level. The market is to be sold on rallies and at the first signs of exhaustion. We have now formed a structural resistance barrier at the 1.35 level, that extends to the 1.36 level above. The British pound has struggled due to not only a stronger US dollar but concerns about the United Kingdom leaving the European Union. At the end of the day though, this market seems to be more about greenback strengthen anything else. We are expecting one interest rate hike out of the Bank of England, while anticipating three out of the Federal Reserve.
This article provided by NewsEdge.