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EUR/GBP Technical Analysis: Euro Clears Channel Resistance

EUR/GBP Technical Analysis: Euro Clears Channel Resistance

2017-03-02 01:12:00
Ilya Spivak, Sr. Currency Strategist
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Talking Points:

  • EUR/GBP Technical Strategy: Flat
  • Euro breaks monthly channel resistance, hints at further gains vs. Pound
  • Longer-term positioning favors weakness but trade setup absent for now

The Euro broke above resistance capping gains versus the British Pound for nearly a month, hinting the near-term bias may have shifted in favor of the upside. Longer-term positioning may signal otherwise however, with prices potentially carving out a significant top.

From here, a daily close above the 38.2% Fibonacci expansion at 0.8610 opens the door for a challenge of the February 6 high at 0.8645, followed by the 50% level at 0.8675. Alternatively, a reversal back below the 23.6% Fib at 0.8530 paves the way for a retest of the 14.6% expansion at 0.8481.

A short position triggered at 0.8461 was stopped out on a narrow close above 0.8506. Current positioning does not appear to offer an attractive setup to re-establish exposure and opting for the sidelines seems most prudent until a better-defined opportunity presents itself.

What makes EUR/GBP one of the top DailyFX trades for 2017? See our forecast and find out!

EUR/GBP Technical Analysis: Euro Clears Channel Resistance

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