EUR/GBP Weekly technical Outlook

By IBTimes Staff Reporter | November 14 2009 12:17 PM

EUR/GBP's rebound was limited at 0.9064 last week and weakened again. The development argues that correction from 0.9410 is still in progress. Initial bias will remain on the downside this week and bring of 0.8897 will bring fall resumption to 0.8704/8837 support zone. Nevertheless, in such case, strong support should be seen inside this zone to finally conclude the correction. On the upside, above 0.9604 will be an initial alert that correction from 0.9410 has completed and will flip bias back to the upside for 0.9238 resistance for confirmation.

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In the bigger picture, medium term correction from 0.9799 has completed with three waves down to 0.8399 already and rise from there is tentatively treated as resumption of long term up trend. As fall from 0.9410 is treated as correction to rise from 0.8399 only, it's expected to conclude in 0.8704/8837 support zone. Above 0.9238 will indicate that such correction has completed and rise from 0.8399 is possibility resuming for a retest of 0.9799 high first. Break of 0.9799 will bring rally to next medium term target at 61.8% projection of 0.6535 to 0.9799 from 0.8399 at 1.0416. We'll hold on to this bullish view as long as 0.8704 support holds.

In the long term picture, long term up trend in EUR/GBP might be resuming as correction from 0.9799 has completed at 0.8399. Decisive break of 0.9799 high will confirm this bullish view and target 261.8% projection of 0.5680 to 0.7258 from 0.6535 at 1.0666.

EUR/GBP