Forex: EUR/GBP Technical Analysis – Familiar Trend Line in Play
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- EUR/GBP Technical Strategy: Flat
- Support: 0.8257 (trend line), 0.8045 (Mar 28 low)
- Resistance: 0.8302 (23.6% Fib exp.), 0.8338 (38.2% Fib exp.)
The Euro is testing support at a rising trend line set from mid-February against the British Pound having turned lower below 0.84 as expected. This barrier is now at 0.8257, with a daily close beneath that eyeing the March 28 swing low at 0.8045.The first layer of resistance is at 0.8302, the 23.6% Fibonacci expansion, with a breach above that targeting the 38.2% level at 0.8338.
Risk/reward considerations argue against entering short with prices trading in close proximity to relevant support. On the other hand, taking up the long side looks premature absent a defined bullish reversal signal. With that in mind, we will continue to stand aside for now.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com