The British pound initially rally during the course of the trading session on Thursday but then turned around to show signs of exhaustion again. In fact, we ended up forming a shooting star that suggests we have a lot of volatility ahead of us. The market continues to see a lot of choppy behavior and of course we are still looking at the “death cross” as the 50 day EMA has broken below the 200 day EMA.
If we break down below the bottom of the candlestick for the session, then I think we probably go looking towards the 1.36 handle again. That being said, I think there is enough noise underneath that you have to be very cautious about shorting, at least until we break down below the 1.30 550 level.