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Talking Points:
- EUR/GBP Technical Strategy: Pending Short
- Support: 0.7911, 0.7873, 0.7834
- Resistance:0.7958, 0.7989, 0.8033
The Euro appears to be gearing up to resume its down trend against the British Pound after topping above the 0.8300 figure. A daily close below the 23.6% Fibonacci expansionat 0.7911 exposes the July 23 low at 0.7873. Alternatively, a turn back above the 14.6% level at 0.7958 opens the door for a retest of rising trend line support-turned-resistance at 0.7989.
The push through trend line support suggests the corrective bounce from July’s low is yielding back to the dominant down trend. Selling at market is unattractive from a risk/reward perspective however and we will set an order to short at 0.7972 instead. If triggered, the position will initially target 0.7911 with a stop-loss activated on a daily close above 0.8033.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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