A curious day yesterday for the $uros to poundsr which whilst ending the day on a wide spread down bar, in fact finished the trading session marginally higher, due to the gapped up open, a curious signal and one that we need to consider carefully from a technical perspective.  The first point to note is that yesterday morning’s opening price was deep into the solid resistance area between the key levels of 0.93 and 0.95 which I outlined in last week’s market commentary as being the defining technical price level for the next few weeks, and should this be breached then we may see a run higher to 0.95 and on towards parity in due course. However, the signal from yesterday would seem to suggest that this level may present a stiff test and yesterday’s failed attempt may be the first of several at this critical level as the euros to pounds market now takes a breather before attempting to push higher once again, but with the caveat this this is a warning signal that the move higher, may be a struggle, and is certainly far from certain following yesterday’s price action on the daily chart. However, time will tell and my own view is that we will see this level breached in due course, and a break above this region into clearer waters in due course.

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