EUR/GBP Technical Analysis: Euro Reversal Gathers Steam
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- EUR/GBP Technical Strategy: Flat
- Support: 0.6985, 0.6930, 0.6876
- Resistance: 0.7051, 0.7112, 0.7159
The Euro moved lower against the British Pound as expected after prices put in a bearish Dark Cloud Cover candlestick pattern. Near-term support is at 0.6985, the 38.2% Fibonacci expansion, with a break below that on a daily closing basis exposing the 50% level at 0.6930. Alternatively, a turn back above the 23.6% Fib at 0.7051 clears the way for a test of trend line resistance at 0.7112.
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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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com