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Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7813, 0.7787, 0.7765
- Resistance: 0.7865, 0.7891, 0.7926
The Euro continued to recover for a third consecutive day against the British Pound but the move appears to be corrective for the time being. A daily close above the 0.7856-65 area marked by the 38.2% Fibonacci retracement and Triangle floor support-turned-resistance exposes 50% Fibonacci retracement at 0.7891. Alternatively, a turn below the 23.6% level at 0.7813 clears the way for a test of the 14.6% Fib at 0.7787.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
