EUR/GBP Technical Analysis: Euro Rises to 2-Month High
To receive Ilya's analysis directly via email, please SIGN UP HERE
- EUR/GBP Technical Strategy: Flat
- Waiting to Enter Short as Euro Corrects Higher, Hitting 2-Month High vs. Pound
- Risk/reward Parameters, Absence of Defined Reversal Signal Argue Against Short
The Euro continues to push higher against the British Pound, with prices rising to the highest level in two months. The pair is closing in on a test of key medium-term trend resistance marked by a falling trend line capping gains since August 2013.
Near-term resistance is at 0.7357, the 38.2% Fibonacci expansion. A break above this barrier on a daily closing basis clears the way for a test of 0.7395, the intersection of the 50% level and the aforementioned trend line. Alternatively, a reversal below the 23.6% Fib at 0.7309 opens the door for a challenge of resistance-turned-support at 0.7278, the December 8 high.
The dominant EUR/GBP trend remains bearish. With that in mind, the current upswing looks corrective and presents a future opportunity to short. The absence of a clear-cut bearish reversal signal and the narrow range between immediate support and resistance levels argues against entering a trade at current levels however. With that in mind, we will remain flat.
Losing Money Trading Forex? This Might Be Why.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.