Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.6985, 0.6930, 0.6876
- Resistance: 0.7051, 0.7083, 0.7159
The euro moved lower against the British pound as expected after prices put in a bearish Dark Cloud Cover candlestick pattern. Near-term support is at 0.6985, the 38.2% Fibonacci expansion, with a break below that on a daily closing basis exposing the 50% level at 0.6930. Alternatively, a turn back above the 23.6% Fib at 0.7051 clears the way for a test of trend line resistance at 0.7083.
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests that taking up the long side is premature. With that in mind, we will remain flat for now.