EUR/GBP Technical Analysis – Stalling After Channel Break
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- EUR/GBP Technical Strategy: Flat
- Support: 0.8104 (76.4% Fib exp), 0.8096 (channel top), 0.8081 (May 23 low)
- Resistance:0.8133 (61.8% Fib exp.), 0.8157 (50% Fib exp.)
The Euro is trying to extend its advance against the British Pound after prices broke above the top of a falling channel in play since late April. Resistance is now at 0.8133, the 61.8% Fibonacci expansion, with a break above that exposing the 50% level at 0.8157. Alternatively, a daily close below the 76.4% Fib at 0.8104 opens door for a test of the channel top at 0.8096, followed by the May 23 low at 0.8081.
Risk/reward considerations argue against entering long with prices sitting squarely at resistance. On the other hand, taking up the short side seems premature absent a defined bearish reversal signal. We will remain flat for now.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.