EUR/GBP Technical Analysis: Attempted Euro Breakout Fails
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- EUR/GBP Technical Strategy: Pending short at 0.8663
- Euro spikes to two-week high but momentum conspicuously falters
- Short entry order aims for improvement in risk/reward parameters
The Euro spiked to the highest level in two weeks against the British Pound but the single currency conspicuously failed to sustain momentum. It swiftly retreated back below resistance defining the near-term down move, suggesting signs of topping below the 0.88 figure remain intact.
From here, a daily close below the 0.8614-15 area (March 23 close, 38.2% Fibonacci expansion) opens the door for a test of the 0.8552-62 zone (February 17 close, 50% level). Alternatively, a move back above the 23.6% Fib at 0.8681 would invalidate the near-term down trend and expose 0.8787, the March 13 high.
Entering short seems compelling but prices are a bit too close to support to justify entering the trade at market from a risk/reward perspective. With that in mind, an entry order has been established to sell the pair at 0.8663. If triggered, the trade will initially target 0.8614, with a stop-loss activated on a daily close above 0.8687.
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