Daily Pivots: (S1) 0.8713; (P) 0.8747; (R1) 0.8804; More…
EUR/GBP retreats sharply today but stays above 0.8704 minor support so far. Intraday bias remains on the upside for the moment. Rise form 0.8402 is expected to target 0.8851 resistance and above. Nonetheless, actions from 0.8303 are seen as the second leg of the corrective pattern from 0.9304. Hence, we’d expect strong resistance from 100% projection of 0.8303 to 0.8851 from 0.8402 at 0.8950 to limit upside. On the downside, below 0.8704 minor support will turn bias neutral and bring retreat before staging another rally.
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).
