EUR/GBP Technical Analysis: Euro Trend Still Favors Weakness
EUR/GBP Technical Strategy: Flat
- Euro rebound brings prices toward 2-month high vs British Pound
- Overall trajectory defined by falling channel set from October 2017
- Waiting for actionable signal, improved risk/reward setup for trade
The Euro continues to inch upward against the British Pound but the dominant price trend continues to favor a downside bias for the single currency. The pair has recovered to the highest level in nearly two months but price action remains firmly locked within a falling channel set from October 2017.
Major resistance comes in at 0.8904, the confluence of a former chart inflection point as well as the trend channel top. A close above that confirmed on a daily closing basis exposes the March 7 high at 0.8968. Alternatively, a turn below resistance turned-support at 0.8797 targets counter-trend support at 0.8730.
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Prices are too close to immediate resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a clearly-defined topping signal warns against taking up the short side to bet on bearish trend resumptionprematurely. On balance, standing aside seems most sensible for now.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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