EUR/GBP Technical Analysis: Euro Selloff Meets Key Support
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- EUR/GBP Technical Strategy: Flat
- Support: 0.7761, 0.7727, 0.7692
- Resistance: 0.7804, 0.7872, 0.7891
The Euro is accelerating downward having turned lower against the British Pound as expected after forming a bearish Three Inside Down candlestick pattern. Near-term support is in the 0.7761-65 area, marked by the 38.2% Fibonacci expansion and the September 30 low, with a daily close below that on a daily closing basis exposing the 50% level at 0.7727. Alternatively, a reversal above the 23.6% Fib at 0.7804 opens the door for a challenge of the 0.7856-72 area (Triangle floor, 38.2% Fib retracement).
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests that taking up the long side is premature. With that in mind, we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope
--- 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.