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Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.7399, 0.7302, 0.7205
- Resistance: 0.7459, 0.7507, 0.7556
The Euro is attempting to mount a recovery against the British Pound after slumping to the lowest level in seven years. A daily close below the 76.4% Fibonacci expansion at 0.7399 exposes the 100% level at 0.7302. Alternatively, a turn above the 61.8% Fib at 0.7459 opens the door for a challenge of the 50% expansion at 0.7507.
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 short 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
