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Talking Points:
- EUR/GBP Technical Strategy: Flat
- Euro rebounds to break two-month trend line resistance
- Longer-term H&S topping pattern might still play out
The Euro recovered to a weekly high against the British Pound, breaking trend line resistance that had contained the upside since mid-March. This returns prices to levels prevailing after the first round of the French presidential election just the runoff looms ahead.
Near-term resistance is now at 0.8494, the 38.2% Fibonacci retracement. A daily close above that exposes the 50% level at 0.8550. Alternatively, a reversal back below trend line resistance-turned-support at 0.8473 opens the door for a back toward 0.8403.
The break of trend line resistance warns that the near-term directional bias may have shifted. With that in mind, the short EUR/GBP trade triggered at 0.8497 has been closed at breakeven. The possibility of a large Head and Shoulders top remains, but an actionable entry opportunity seems to be absent.
What makes EUR/GBP one of the top DailyFX trades for 2017? See our forecast and find out!
