Sterling and the AUD have been the most oversold currencies over the last 6 months and I believe this trend is starting to turn. Volatility will be high but the EUR is way too high against both of the above and I think that EUR/GBP should fall to .85ish and EUR/AUD back towards 1.70 from its’ current 1.90.
I have already tried once to get on EUR/GBP but was scared off. Now I will try again. I am taking a small short position at current levels and will look to add on rallies back to .9300. Above .9525 and I’m out. Obviously with such wide parameters I must keep positions small and affordable. Hopefully at some stage I will get in the flow of the way EUR/GBP is trading and then I can increase my risk more easily.
Good luck today.
