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- EUR/GBP Technical Strategy: Flat
- Support: 0.7936, 0.7913, 0.7885
- Resistance:0.7970, 0.8005, 0.8033
The Euro is attempting to initiate a recovery against the British Pound after putting in a Bullish Engulfing candlestick pattern. The first layer of resistance is at 0.7970, the 23.6% Fibonacci retracement. A daily close above this barrier exposes the 38.2% level at 0.8005. Alternatively, a reversal below the 50% Fib expansion at 0.7936 opens the door for a test of the 61.8% barrier at 0.7913.
The ECB looks to be the most dovish of the leading central banks, putting the Euro at a disadvantage against its major counterparts. With that in mind, we will opt not to pursue a long position and wait for the bounce to produce a selling opportunity.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com