Euro and Pound Weekly Update - Feb. 04 close

EURUSD

Last week the Euro-Dollar ended on a bearish pin bar yet to be confirmed, with price at the SMA100 level and still inside the symmetrical triangle formation. On daily charts, price reached the lower trend line of a rising wedge, ending just above SMA100 in confluence with the middle line of the Bollinger Bands and near the 38.2% Fibonacci retracement on the previous swing high. In my opinion there is still room to the upside and I would favor a bullish run towards the upper line of the wedge before a fall, for a retest of the recent highs at 1.3860 and if that level holds as a resistance we could see another correction leg towards 1.3400 psychological level. Monday’s price action shows a small pin bar which seems to have confirmation in today’s upmove.

GBPUSD

The Pound-Dollar made a double top on the weekly charts with a fair rejection from the highs, and ending below the upper line of a symmetrical triangle formation. The outlook seems bullish though, and I would favor a break of last thursday highs for an extension to 1.6500/30. On the bearish side, we can have another retest of the upper line of the previous descending channel, bringing this pair down to the daily SMA34 and 61.8% Fibonacci retracement on the whole previous swing high, or at least to the 50% with levels to be watched being 1.5800 and 1.5700.

EURGBP

Last week was bearish for this pair after a cross of the middle line of the weekly Bollinger Bands, with price ending at the weekly SMA34 level and below the daily SMA200 with a doji candle. Outlook is mixed and I would think of a consolidation between daily SMA100 and SMA200 after watching yesterday’s price action, with preference for a bullish move which could bring this pair again towards the highs for a retest of the 0.8600/50 resistance after a clear break of SMA100 level at 0.8540/60.