Daily Pivots: (S1) 0.8437; (P) 0.8478; (R1) 0.8499; More…
EUR/GBP’s break of 0.8469 support indicates resumption of fall from 0.8851. This is in line with our view that fall from 0.8851 is the third leg of the corrective pattern from 0.9304. Intraday bias is now back on the downside for 0.8303 low next. Break will extend the fall from 0.9304 to 0.8116 key cluster support level. On the upside, above 0.8550 minor resistance will turn bias neutral first. But outlook will stay bearish as long as 0.8643 resistance holds.
In the bigger picture, price actions from 0.9304 are viewed as a medium term corrective pattern. Deeper fall cannot be ruled out yet. But we’d expect strong support from 0.8116 cluster support (50% retracement of 0.6935 to 0.9304 at 0.8120) to contain downside. Overall, the corrective pattern would take some time to complete before long term up trend resumes at a later stage. Break of 0.9304 will pave the way to 0.9799 (2008 high).
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