EURGBP has generally been in an uptrend since late last June but the dip to .8285 was disappointing since it was a lower low than the prior dip to .8335. That's not a huge amount of pips but it's a warning. There are lots of triangles around these days and EURGBP is no exception. Bulls expected price would reach the upper boundary around .8826 before turning but it failed at .8672, quite a bit short of that and just pips above the 12/31 high. The upper boundary is near fib confluence of .8849/10 (.5 and .618 of the move down from .9412 and .9134 respectively). Perhaps it will get there in the next few days but obviously it has to close above .8672. Looking at the large bullsh candle before the last couple of day's pullback, it seems possible. Support is at confluence at .8505 and .8424/00 and then the trend line at .8348. A close below .8285 would bring in support at .8143 and .8068. My inclination is to buy near there or possibly at present levels if momentum shapes up on the shorter term charts.
Here's a daily chart:
© Dianne Fecteau, 2011. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
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