EUR/GBP dived sharply to as low as 0.8548 last week but formed a temporary low there and turn sideway. At this point, we're still slightly favoring the case that consolidation from 0.8529 has completed with three waves up to 0.8830. Hence, current consolidation from 0.8548 is expected to be limited by 0.8669 minor resistance and bring fall resumption. Below 0.8548 will target 0.8529 first. Further break there will confirm resumption of the whole decline from 0.9083 and should target 0.8284 support next. On the upside, though, above 0.8669 will delay the bearish case and bring more consolidations first.

In the bigger picture, price actions from 0.9799 (2008) should be unfolding as a consolidation pattern in the long term up trend. The first leg is completed with three waves down to 0.8067. Second leg should also be finished at 0.9083. Fall from 0.9083 is treated as the third leg and should target 0.8067 first and possibly further to 61.8% projection of 0.9799 to 0.8067 from 0.9083 at 0.8013 (which is closes to 0.8 psychological level). Nevertheless, we'd expect strong support from 0.7693/8186 support zone to contain downside to finish off the consolidation. On the upside, break of 0.8884 resistance, however, will invalidate this view and argue that the choppy rise from 0.8067 is still in progress for another high above 0.9083 before completion.

In the long term picture, long term up trend from 2000 low of 0.5680 shouldn't be over yet and the choppy fall from 2008 high of 0.9799 should be a correction only. We'd expect such correction to be contained by 0.7963/0.8186 support zone and bring up trend resumption. Rise from 0.5680 is still expected to extend beyond 0.9799 high eventually.

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