- Pound sold-off overnight on reports of the Manchester terror attacks. EUR/GBP hits 4-week high of 0.8666, intraday bias higher.
- The pair is extending gains after breakout above major resistance at 0.8595 (converged 200-DMA & trendline).
- Momentum indicators on weekly charts are biased higher. The pair has broken above weekly 50-SMA at 0.8534.
- Near-term reversal in trend likely on close below 200-DMA at 0.8595.
- Investors assess the implications of the terror blast on the upcoming UK general elections called in by the UK PM May in a bid to get a better Brexit deal.
- Focus now on the UK inflation report due in the session ahead, following the release of the UK public sector net borrowing data.
Support levels - 0.8595 (200-DMA), 0.8516 (23.6% Fib of 0.92253 to 0.82970 fall), 0.85 (20-DMA)
Resistance levels - 0.87, 0.8735 (Mar 29 high), 0.87861 (50% Fib of 0.92253 to 0.82970 fall)
Call update: Our previous call (http://www.econotimes.com/FxWirePro-EUR-GBP-breaks-200-DMA-at-08595-good-to-go-long-on-dips-714647) has hit TP1.
Recommendation: Book partial profits at highs. Raise trailing stop to 0.8595. Hold for upside.
FxWirePro Currency Strength Index: FxWirePro's Hourly EUR Spot Index was at 82.728 (Bullish), while Hourly GBP Spot Index was at -50.6692 (Neutral) at 0500 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
