- EUR/GBP halts 3 consecutive sessions of losses, attempts sluggish recovery, up 0.12% on the day.
- Bears on track to test 200-DMA at 0.8764, violation there could see further downside.
- EUR/GBP is extending post-BOE corrective slide, and we see scope for further weakness on break below 200-DMA.
- Technical studies on weekly charts are also bearish. Stochs and RSI are biased lower and MACD supports trend lower.
- Immediate resistance seen at 0.8876 (20-DMA), break above to see minor upside till 50-DMA at 0.8916.
- We see bearish invalidation only on breakout above 50-DMA, scope then for test of 23.6% Fib at 0.9068.
Support levels - 0.8764 (200-DMA), 0.8733 (Nov 1 low), 0.8682 (61.8% Fib retrace of 0.8297 to 0.93065 rally)
Resistance levels - 0.8844 (5-DMA), 0.8876 (20-DMA), 0.89, 0.8916 (50-DMA)
Call update: We had advised a short (http://www.econotimes.com/FxWirePro-EUR-GBP-on-track-to-test-200-DMA-at-08762-violation-there-could-) in the pair.
Recommendation: Bias lower, stay short.
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