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EUR/GBP Short Position - Update

EUR/GBP Short Position - Update

Nick Cawley, Senior Strategist

Nick Cawley, Analyst, May 2, 2017

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*** Original Report - April 27 - With Updated Charts ***

EURGBP looks set to fall after its recent post-French election bounce with the spot price (0.85073) close to breaking below the 20-day ma (0.84849), confirming a bearish outlook. The 20-day ma broke below the 50- and 100-day ma on April 11-12 opening the move lower.

EURGBP Daily Timeframe (January – May 2, 2017)

Chart by IG

And a look at the daily chart also shows that EURGBP has failed to convincingly break above the 61.8% Fibonacci level of the recent December 5, 2016/January 15, 2017 low-high range.

Chart by IG

Position – Short EUR/GBP

Entry – 0.85073.

Stop – Moved to Entry at 0.8507 after Target 1 achieved.

Target 1 – Fibonacci 76.4% at 0.84364 – Hit on April 27.

Target 2 – April 18 daily low of 0.83133.

*** Update ***

With EURGBP moving in our favour and the first target of 0.8436 achieved on April 27 – with half of the position taken off with a profit – we are moving our stop down from its initial level of 0.8555 to the Entry level at 0.8507, effectively eliminating any downside in the trade. If the trade is stopped out we still retain 71 pips profit.

---Written by Nick Cawley, Market Analyst

You can follow Nick on Twitter @nickcawley1

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.