Euro Cross Pick 11.15.2012
In light of the dismal developments coming out of the U.K., we’ve seen the EURGBP climb to a fresh monthly high of 0.8063, but the lack of momentum to trade back above the 200-Day SMA (0.8079) may provide a selling opportunity as the pair appears to be carving out a lower top in November. As market participants discount the threat for a Greek default, fears of a deepening recession should weigh on the Euro, while the British Pound looks poised for a rebound as we anticipate the Bank of England (BoE) to carry its current policy into the following year. In turn, I will look to sell on a move back below 0.8050, with a stop just above the 200-Day SMA – 0.8080 – while we will have a soft target around the 100-Day SMA (0.7961).
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