EUR/GBP Technical Analysis: Pullback Cut Short Above 0.73
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- EUR/GBP Technical Strategy: Flat
- Euro Finds Support Above 0.73 Figure After Retreating from 5-Month High
- Risk/Reward Parameters Argue Against Committing to Long or Short Trade
The Euro is consolidating in a choppy range near the 0.74 figure against the British Pound as prices await new direction cues.The pair pulled back after hitting a five-month high but soon found support at a rising trend line guiding the move higher since August.
A daily close above the August 24 high at 0.7421 opens the door for a challenge of the May 7 top at 0.7482. Alternatively, a push below the intersection of trend line support and the 23.6% Fibonacci retracement at 0.7322 clears the way for a test of the 38.2% level at 0.7247.
Risk/reward considerations argue against taking a trade at current levels. On one hand, prices are too close to resistance to make for an attractive long trade. On the other, the absence of a bearish reversal signal hints taking up the short side is premature. We will stand aside for now, waiting for positioning to yield a better-defined opportunity.
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