5 Sep 2013
Oversold EUR/GBP still dangling above correction support of 0.8397 ahead of BOE / ECB
FXstreet.com (Barcelona) - The EUR/GBP cross heads into Thursday’s twin central bank announcements trending lower. Euro bulls hoping for the right combination of words to allow support at 0.8397 to hold.
EUR/GBP traders will not be left with nothing to do Thursday morning
The rate decisions and accompanying policy statements from both the European Central Bank and the Bank of England will either reverse this bearish technical set-up or add more fuel to the downside fire for EUR/GBP. The only major data point due out for the rest of the week after the bankers make their announcements will be Friday’s British inflation, manufacturing production and trade balance data.
Technical outlook for EUR/GBP
Technicians say the big hope for the bulls is that EURGBP will hold up above 0.8397 support – which represents horizontal line support and a Fibonacci projection line for an “abc” pattern. They point out, though, that if the pivot points on the corrective “abc” pattern are adjusted slightly that the support level could actually be as low as 0.8360. Any close below that level will blow the hope right out of the hopeful bulls and give new downside targets of 0.8300 and possibly 0.8241. Resistance comes into play at 0.8500.
EUR/GBP traders will not be left with nothing to do Thursday morning
The rate decisions and accompanying policy statements from both the European Central Bank and the Bank of England will either reverse this bearish technical set-up or add more fuel to the downside fire for EUR/GBP. The only major data point due out for the rest of the week after the bankers make their announcements will be Friday’s British inflation, manufacturing production and trade balance data.
Technical outlook for EUR/GBP
Technicians say the big hope for the bulls is that EURGBP will hold up above 0.8397 support – which represents horizontal line support and a Fibonacci projection line for an “abc” pattern. They point out, though, that if the pivot points on the corrective “abc” pattern are adjusted slightly that the support level could actually be as low as 0.8360. Any close below that level will blow the hope right out of the hopeful bulls and give new downside targets of 0.8300 and possibly 0.8241. Resistance comes into play at 0.8500.