Daily Pivots: (S1) 0.8456; (P) 0.8473; (R1) 0.8486; More…
Intraday bias in EUR/GBP remains on the downside for 0.8402 support. As noted before, consolidation from 0.8303 could be completed at 0.8786. Fall from 0.8786 is developing as the third leg of the correction from 0.9304. Decisive break of 0.8402 support will confirm our bearish view and target 0.8303 and below. At this point, we’d expect front support from 0.8116/20 cluster support to contain downside and complete the correction from 0.9304. On the upside, break of 0.8589 resistance is needed to indicate short term bottoming. Otherwise, outlook will stay cautiously bearish in case of recovery.
In the bigger picture, price actions from 0.9304 are viewed as a medium term corrective pattern. Such decline is likely ready to resume and should make a new low below 0.8303. At this point, we’d expect strong support from 0.8116 cluster support (50% retracement of 0.6935 to 0.9304 at 0.8120) to contain downside. Rise from 0.6935 (2015 low) will resume at a later stage to 0.9799 (2008 high). However, sustained break of 0.8116 could bring deeper decline to next key support level at 0.7564 before the correction completes.
