EURGBP TECHNICAL ANALYSIS
- Brexit uncertainty pushing EURGBP to 22-month highs
- In week ahead, the pair may test critical support levels
- EURGBP strength at the mercy of political volatility?
See our free guide to learn how to use economic news in your trading strategy !
Contrary to my previous weekly technical forecast, EURGBP’s retreat appeared to have been short lived after it was interrupted by Brexit uncertainty that caused the British Pound to plummet. The pair is now testing a 22-month high after spiking over 2.50 percent in the less than a week. The pair may now look to test resistance-turned-support at 0.9110 (highest red dotted line).
EURGBP Tips Hat to Brexit Uncertainty
EURGBP chart created using TradingView
Zooming out to a weekly chart, earlier this month the pair appeared as if it was beginning to lose steam after closing higher for 11 consecutive weeks. However, uncertainty about an orderly Brexit pressured Sterling lower across most crosses and instead led EURGBP to spike.
EURGBP Weekly Chart – July 25
EURGBP chart created using TradingView
EURGBP Weekly Chart – August 1
EURGBP chart created using TradingView
Looking ahead, EURGBP will likely again test resistance-turned-support at 0.9110 before advancing higher or retreating. As mentioned in my previous articles, performing technical analysis on any GBP-crosses is difficult because of the currency’s tie to a politically-volatile environment. If the pair fails to consistently close above 0.9110, it may hover below but above 0.9060.
EURGBP TRADING RESOURCES
- Join a free webinar and have your trading questions answered
- Just getting started? See our beginners’ guide for FX traders
- Having trouble with your strategy? Here’s the #1 mistake that traders make
--- Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com
To contact Dimitri, use the comments section below or @ZabelinDimitri on Twitter
