EUR/GBP Technical Analysis: Short Trade Setup Established
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- EUR/GBP Technical Strategy: Pending Short
- Support: 0.7911, 0.7873, 0.7834
- Resistance:0.7958, 0.7984, 0.8033
The Euro may be ready to resume its down trend against the British Pound after finding resistance above the 0.8300 figure. Near-term support is at 0.7911, the 23.6% Fibonacci expansion, with a break below that on a daily closing basis exposing the July 23 low at 0.7873. Alternatively, a reversal above the 14.6% level at 0.7958 opens the door for a retest of rising trend line support-turned-resistance at 0.7984.
The rising trend line break suggests the corrective upswing initiated in late July has now given way to the dominant downward trajectory. Entering at current levels is unattractive from a risk/reward perspective however and we will opt to establish an order to sell the pair at 0.7972. If triggered, the position will initially target 0.7911 with a stop-loss activated on a daily close above 0.8033.
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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.