Elections with an unclear end in Italy and UK troubles around Brexit, what next for EUR/GBP?

Let's start with the big picture - W1.

The upward trend began at the end of 2015. is obviously coming to an end. We have a Double Top + break of the main diagonal. What worries most traders is that there is no strong downward momentum after the breakthrough, and instead the price goes into consolidation around the average of the average. Demarker is in a neutral position at about 50. Moods remain mixed

On a daily schedule, things are slightly different. The price is a descending channel and is currently located at the top of the channel, testing 200SMA. What is worrying is that the bottom bottom is equal to the previous one and the likelihood that the short-term downward trend is over is high. 50SMA and 200SMA are sword crossed - negative for the price. Dem(8) is in the over-purchase zone, but does not signal for a subsequent Short. Given the price and disputed development of Brexit talks, aggressive traders will try to position themselves with Short of current levels and SL at 0.9000 levels.

What do big investors do according to the report on net speculative positions?

EUR - the net players are Long on the euro, but last week the total number of long contracts dropped to 140.8K from 148.7K. The reason for this is the forthcoming elections in Italy and the uncertainty that they are most likely to bring about. Taking into account the long-standing trend of the euro, a large number of investors will withdraw from the currency in order to protect their money.

GBP - the pounds are similar, net long positions show a decrease from the previous week to 27.9K from 31.7K.

Taking into account the background to the controversial elections in Italy and Britain's embarrassing stance on the Brexit talks, we think the price will stay in the narrow downward channel and the shorts will remain the better trade until we see a clear breakthrough in the resistance.

Jr Trader Petar Milanov

Read more:

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