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- EUR/GBP Technical Strategy: Short at 0.7876
- Euro corrects higher as expected, challenging trend-defining resistance
- Gains seen as corrective within larger down move, short trade still in play
The Euro corrected sharply higher against the British Pound as expected , making good on technical cues indentified earlier in the week . Prices now stand squarely at trend line resistance defining the down move since early April, with behavior here likely to establish the dominant bias in the near term.
A close above the intersection of the trend line and the 38.2% Fibonacci retracement at 0.7776 sees the next upside barrier at 0.7841, the 50% level. Alternatively, a reversal back below the 23.6% Fib at 0.7695 opens the door for a retest of the 14.6% retracement at 0.7645.
A short EUR/GBP position was established at 0.7876 and partial profits taken after the trade met its first objective . Overall positioning continues to argue in favor of the downside and remaining exposure will remain in play. The stop-loss is now at the breakeven level.
What do DailyFX analysts expect for the Euro and Pound in 2016? Find out here !
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