EUR/GBP Technical Analysis

The Euro looks as if it is trying to fight back against the pound, but it continues to fail. Every time it rallies, it seems to slump a bit, and I’m watching this 200-day EMA in this pair for potential support. If we were to break down below there, then we could open up the possibility of a move down to the 0.86 level.

The 0.86 level, of course, is an area that’s been important multiple times, and if we can break down below there, we really start to see the momentum pick up. I do prefer the pound over the Euro, no doubt about it, but at this point in time, I think we’re still trying to set the tone, whether or not we can actually break down. This is a market that features two central banks, one in Europe, which is sitting still, and the other in London, which, of course, has recently cut, but it’s going to be very slow, so the interest rate differential will continue to favor the British for quite some time.

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