EUR/GBP has a very noisy session on Wednesday, testing the resistance

The Euro has been very noisy against the British pound during the trading session on Wednesday but did rally enough to test the 0.8 level for resistance. We have pulled back from there, and it looks likely that the market should continue to be noisy in general. I think that we are consolidating between the 0.88 level on the top, and the 0.8725 level on the bottom. This is a market that is short-term focused at best, as there are a lot of potential headlines coming out of both the European Union and the United Kingdom that can move the markets due to the divorce.

If we do break above the 0.88 level, the market will test the 0.8825 handle, and if we break above that level the market could go to the 0.89 level. However, the market breaking down below the 0.8725 level would test the 0.87 handle. If we managed to break down below there, then it opens up the possibility of the 0.86 level, an area that has been very important more than once. I think that small position sizes are necessary for this market place, as it will continue to be very noisy and difficult to navigate. Quite frankly, when you look at the EUR/USD and the GBP/USD pair is, they both show extreme weakness in the European currencies. Ultimately, I think this is essentially a pair of lightweights going at it, so therefore it’s not you take much to push things around. Pay attention to the levels mentioned previously, they will be the guideposts.