EUR/GBP Technical Analysis: Euro Takes Aim at Ten-Month Range Top
EUR/GBP Technical Strategy: Flat
- Euro accelerates higher vs Pound amid “no-deal” Brexit worries
- Prices poised to challenge ten-month congestion range resistance
- Improved risk/reward parameters needed for attractive long trade
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The Euro is accelerating higher against the British Pound, with prices poised to break out of the choppy range containing them for the past ten months. Sterling’s recent weakness comes amid concerns about a “no-deal” Brexit, whereby the UK would leave the EU without an accord on the future economic relationship.
Resistance stands in the 0.9033-35 area, marked by the October 2017 high and the 50% Fibonacci expansion. A daily close above that opens the door for a test of the 61.8% level at 0.9075. Alternatively, a move back below the 38.2% Fib at 0.8995 exposes resistance-turned-support in the 0.8960-68 area.
Prices are bit too close to near-term resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of an actionable topping signal warns against taking up the short side. Standing aside and waiting for a better-defined setup seems most prudent for now.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.