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- EUR/GBP Technical Strategy: Flat
- Support: 0.8260-81 (trend line, 38.2% Fib ret.), 0.8245 (50% Fib ret.)
- Resistance: 0.8326 (23.6% Fib exp.), 0.8399 (Mar 19 high)
Euro fell as expected against the British Pound after prices put in a Bearish Engulfing candlestick pattern below the 0.84 figure. While risk/reward considerations seem to allow for a short position, we tactically opt to stand aside. The recent break of trend line resistance set from August 2013 warns of a near-term upside bias and we prefer to see that overturned on a move through rising trend line support defining the uptrend launched off the February 17 low. This barrier is bolstered by the 38.2% Fibonacci expansion at 0.8281, with a breach downward exposing the 50% level at 0.8245. Alternatively, a reversal above the 23.6% Fib at 0.8326 eyes the March 19 high at 0.8399.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com