Euro Cross Pick 03.10.2011
I took a small short EUR/GBP position earlier this morning as the overnight rebound in the exchange rate failed to produce a test of the previous day’s high (0.8604), and I expect the pair to trend lower going forward as it carves out a lower top in March. At the same time, the pair appears to be a head-and-shoulders formation on the hourly chart, and I will maintain the position going into the end of the week as price action fails to hold above the shoulders around 0.8600. I am looking for a test of the 20-Day SMA at 0.8497, and have set the stop at 0.8635.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.