GBP/USD, EUR/USD, EUR/GBP Trade Ideas
The Great British Pound is never a leader currency pair but rather a follower to its two main counterparts, EUR and DXY. Historically, GBP was the Great currency and leader as its formal name implies. Every nation rushed to Peg to GBP such as AUD, NZD and many others. That period lasted from 1700's to WW1. Winston Churchill changed the game in the modern day when GBP was pegged to USD at 4.86. It overvalued permanently GBP to USD but also in the modern day to EUR. Why is GBP/USD 1.4, EUR/USD 1.1 and 94.00 USD. Its the effect of WW1 4.86.
GBP as the Pound is the slang term while the proper term is Sterling. Sterling means Sterling Pennies and represents GBP 1000 year tradition as a Silver Currency. Sir Isaac Newton changed that game in the 1700's when he changed GBP from Silver to Gold. Today GBP since 1700's remains a hybrid currency as Silver and Gold. Again GBP as leader disappeared as currency Pegs were hybrid currencies.
Arguments to Churchill are it was the price to rebuild the UK yet its overvaluation to its counterparts never corrected in 80 years. What informs GBP prices as follower is EUR and DXY. That means EUR/USD, EUR/GBP, DXY.
Vital Break points.
GBP/USD. Below 1.4309, Above 1.4492. No changes since last week except few pips changes in the ranges. Sell the tops, buy the bottoms.
EUR/USD. Big break below to watch closely, 1.1270 exactly. Then 1.1190 next. take the breaks.
EUR/GBP. Below 0.7820 and 0.7780. See similarities to EUR/USD, cause it Correlates to EUR/USD at 90%. Above 0.8004.