The Momentum is with the GBP as EUR Concerns Mount

The GBP/EUR currency pair has shown a definite degree of bullishness since March 2017. The positive momentum that we see with the GBP is likely to take the GBP/EUR as high as 1.24 over the short-term. While that remains some ways off, the trend is clearly favouring a rising GBP. Already, the GBP/EUR has broken above the 200-day moving average of 1.164 and the 50-day moving average of 1.165. These technical indicators give a clear indication of the current rising trend. Perhaps the more pertinent question for binary options currency traders is why the sterling is rising against the EUR.

A 4-Horse Race is Underway in France: Casualty #1 is the EUR

Front and centre is the French election. Currency traders and financial analysts are carefully eyeing the opinion polls in the week ahead to see how likely it is that the right-wing party under Le Pen will win the majority in France. The rise of populism in the United States and across Europe is a daunting prospect for markets in that it signifies a break from a collectivist-style mindset in Europe to a nationalist-style mindset.

However, the uncertainty in Europe has undergone yet another dramatic twist, and there are now 4 major contenders for the highest office in France with the rise of Jean-Luc Melenchon. Precisely what the dynamic is in the 4-horse race is unknown. As new contenders jockey for position, it remains to be seen how this will affect the likelihood of a Le Pen win. Owing to this geopolitical uncertainty, the GBP has been rising against the EUR.

Binary Options Trading Advice on the GBPEUR Pair

The GBP/EUR pair will weaken if the contenders weaken Le Pen’s chances of winning. However, if the frontrunners in the election are going to result in a slim majority for Le Pen, the GBP/EUR pair will strengthen. It seems unlikely that the nationalist will scoop the French election victory, but as much was said about Trump’s chances of winning against Democratic rival Hillary Clinton. Media talking heads and political pundits often do not understand the frustrations of the electorate on the ground, and for this reason, financial analysts are keeping an open mind.