EUR/GBP Technical Analysis: Range Support Back in Play

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Talking Points:

• EUR/GBP Technical Strategy: Flat
• Support: 0.7261, 0.7221, 0.7182
• Resistance: 0.7391, 0.7430, 0.7469

The Euro pulled back to test range support above the 0.72 figure against the British Pound once again. A daily close below the 38.2% Fibonacci retracement at 0.7261 exposes the 50% level at 0.7221. Alternatively, a move above the 38.2% Fib expansion at 0.7391opens the door for a challenge of the 50% threshold at 0.7430.

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 an actionable opportunity to present itself.

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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com