EUR/GBP Technical Analysis: Looking to Re-Enter Short
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- EUR/GBP Technical Strategy: Flat
- Support: 0.7803, 0.7728, 0.7654
- Resistance: 0.7896, 0.7953, 0.8030
The Euro declined as expected against the British Pound after prices produced a bearish Dark Cloud Cover candlestick pattern. Near-term support is at 0.7803, the 38.2% Fibonacci expansion, with break below that on a daily closing basis exposing the 0.7728-51 area marked by the July 2012 low and the 50% level. Alternatively, a turn above the 0.7873-96 zone (July 23 low, 23.6% Fib) opens the door for a challenge of the 14.6% expansion at 0.7953.
We sold EURGBP at 0.7850 and have since booked profit on half of the position. The rest of the trade stopped out and breakeven and we will now move to the sidelines, looking for another opportunity to sell the pair in the days ahead.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com