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Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7936, 0.7913, 0.7885
- Resistance:0.7970, 0.8005, 0.8033
The Euro may be setting for a corrective bounce against the British Pound after prices completed a Bullish Engulfing candlestick pattern. Near-term resistance is at 0.7970, the 23.6% Fibonacci retracement, with a break above that on a daily closing targeting the 38.2% level at 0.8005. Alternatively, a move back below the 50% Fib expansion at 0.7936 clears the way for another challenge of the 61.8% barrier at 0.7913.
We are tactically opting not to pursue a long position, choosing not be long the Euro considering the ECB is shaping up to be the most dovish of the major central banks over the coming months. Rather, we will for the upswing to offer short entry opportunities.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
