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Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7727, 0.7692, 0.7649
- Resistance: 0.7765, 0.7804, 0.7874
The Euro is resumed its down trend against the British Pound as expected, slumping to the lowest level since October 2008. A daily close below the 50% Fibonacci expansion at 0.7727 exposes the 61.8% level at 0.7692. Alternatively, a turn above 0.7761-65 area (38.2% Fib, September 30 low) opens the door for a challenge of the 23.6% expansion at 0.7804.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
