EUR/GBP: The Grind Higher to 0.90
EUR/GBP resembles a march of the highest standard by any military force! From the lows seen at 0.85 at the start of the year to the current price of 0.8995 below our psychological handle at 0.90!
10 straight weeks of green candles are nothing short of remarkable, thanks must go to Brexit and the poor sentiment that has been and will continue to be around the Pound. Every retail trader has been saying “Its now time too short” over and over again yet we continue to go higher and higher, Why?
EUR/GBP is a hedge for Brexit. Buying the EUR & selling GBP, the safest and risk-free trade around Brexit, but, in my opinion, this trade will unwind once Brexit is over and done with and I expect a sharp fall back to the lows seen at the start of the year. September/October time is my base case to see the start of this, until then I continue to see further upside for EUR/GBP past 0.90 handle.
Technically 0.90 is a big resistance level, but we have had multiple drives towards this and eventually, I see this giving way and then turning into some strong support for the pair. I don’t expect much to change sentimentally with the pair until Sept/Oct time when we start to get some more decisive action regarding Brexit.