Forex Technical Analysis, EUR/GBP Daily Forecast June 6, 2016
Technical Analysis – The EUR/GBP pair initially fell during the course of the day on Friday, but then rose from there to break out. That being the case, the market looks as if we are going to continue to go higher. The market should continue to punish the British pound due to the fact that we are concerned about whether or not the United Kingdom is going to leave the European Union. With that being the case, the market should try to reach towards the 0.80 level given enough time. Pullbacks will be looked at as value.
In Other View Point –EUR/GBP struggles at 0.79 after gap-up open, long break above
Pound sold-off as latest ‘Brexit’ polls suggests rising possibilities of the UK voting to leave the EU on June 23 EU referendum. EUR/GBP saw a gap up open and extended upside to hit session highs a four-week high of 0.7905. Pair was however rejected at highs, slips below 0.79 handle to currently trade around 0.7886 levels. Momentum studies are bullish, RSI, Stochastics and MACD indicate upside. 0.7906 is stiff resistance which is 61.8% Fib retrace of 0.8117 (Apr 7th high) to 0.7565 (May 25th low). Break above finds next hurdles at 0.7927 (weekly 200 MA), 0.7947 (double top May 4th and Apr 24th) and then 0.80 (78.6% Fib). On the downside, pair remains well supported above 50-DMA 0.7845 and 50% Fib at 0.7840. Go long on decisive break above 0.79, SL: 0.7840, TP: 0.7945/0.80