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Talking Points:
- EUR/GBP Technical Strategy: Flat
- Support: 0.8237 (61.8% Fib ret.), 0.8210 (76.4% Fib ret.)
- Resistance: 0.8258 (50% Fib ret.), 0.8280 (38.2% Fib ret.)
The British Pound is launching a dramatic recovery against the Euro. Prices are testing support at 0.8237, the 61.8% Fibonacci retracement, with a break below that targeting the 76.4% level at 0.8210. A turn back above the 50% Fib at 0.8258 eyes the 38.2% retracement at 0.8280.
Entering short with prices directly at support is unattractive from a risk/reward perspective. Alternatively, a long position would presume a reversal higher, a proposition that lacks any substantive evidence for the time being. As such, we remain on the sidelines.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com