Fundamentals:- It was actually the technical chart that got me looking at this currency pair. However I always look at the fundamentals before I make a trading decision hence:- for a while the Euro and the British Pound have been battling for supremacy in the currency markets. With inflation improving in both zones but wages lacking the boost they need to give consumers confidence to get real spending underway it has been a slog for this currency pair. However they have both been outperforming the United States Dollar which shows strength on both parts. The Brexit battle is on investors minds on a daily basis and words from the powers of Parliament can both strengthen and weaken the Pound at a seconds notice which brings me to believe the battle will end up in the favour of the Euro(at least for the sort term). So we move onto the charts and look for an opportunity......
Technical's:- As you can see from the chart above we have had this sideways battle as aforementioned but with a clear line of resistance; which was broken on the 20th of December giving way to the price of 0.8850. I would like to see this price retested and become support next week which will give the opportunity of a low risk to high reward trade as illustrated. I will be looking at the risk event calendar for key times to hopefully make this trade which will be Tuesday at 9:30 am GMT and Wednesday at the same time.
Trade active
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After entering the trade at the suggested price of 8850 I have now moved the stop loss to break even.
Trade active
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As the price retests the previous price of 8916 it is time to lock in some profit at this point in case we get some reversal. So I am moving the stop loss to 8875 locking in 25 pips profit
Trade closed: stop reached
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There was always a chance this one could reverse from the resistance level hence the profit lock in.. So 25 pips there today