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Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7422, 0.7368, 0.7280
- Resistance: 0.7491, 0.7545, 0.7633
The Euro may be readying to turn higher against the British Pound after prices put in a Bullish Engulfing candlestick pattern. Near-term resistance is at 0.7491, the 14.6% Fibonacci retracement, with a daily close above that exposing the 23.6% level at 0.7545. Alternatively, a drop below the 14.6% Fib expansion at 0.7422 clears the way for a test of the 23.6% threshold at 0.7368.
Our fundamental outlook calls for broad-based Euro weakness as the ECB introduces aggressive stimulus expansion. With that in mind, we will opt to treat any on-coming gains as an opportunity to enter short rather than a long trade setup. In the meantime, we remain flat.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
