Daily Pivots: (S1) 0.8631; (P) 0.8679; (R1) 0.8708; More…
EUR/GBP’s pull back from 0.8786 extends lower today and breached 38.2% retracement of 0.8402 to 0.8786 at 0.8639. There is no sign of bottoming yet. Sustained trading below 0.8639 will target 61.8% retracement 0.8549 and possibly below. On the upside, above 0.8699 minor resistance will turn bias back to the upside for 0.8786 resistance. Break will extend the rise from 0.8402 to 0.8851. Overall, price actions from 0.8303 are seen as the second leg of the corrective pattern from 0.9304. Fall from 0.9304 should resume later.
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).
