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EUR/GBP Technical Analysis: Trading Sideways Ahead of BOE

EUR/GBP Technical Analysis: Trading Sideways Ahead of BOE

Ilya Spivak, Head Strategist, APAC

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Talking Points:

The Euro remains locked in a narrow consolidation range above the 0.72 figure against the British Pound, with the outlines of a descending Triangle pattern hinting at a downside bias.Confirmation of the bearish scenario requires a clear-cut break through Triangle support on a daily closing basis.

A move below the January 22 low at 0.7526 opens the door for a test of the 38.2% Fibonacci retracement at 0.7460. Alternatively, a push above Triangle resistance exposes the 23.6% Fib expansion at 0.7708, followed by the 38.2% threshold at 0.7821.

An actionable EUR/GBP trade setup is absent for the time being. The longer-term trend favors the downside but entering short here seems ill-advised as high-impact event risk by way of the BOE monetary policy announcement threatens to unravel technical positioning. With that in mind, we will wait on the sidelines for a more attractive opportunity to present itself.

Is the Euro behaving as DailyFX analysts expected? See our quarterly forecast to find out!

EUR/GBP Technical Analysis: Trading Sideways Ahead of BOE

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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