EUR/GBP to target the 0.9308 2017 high – Commerzbank

EUR/GBP is seeing a period of stabilisation ahead of the 55-day ma at 0.9038 and trades at 0.9140, posting mild gains of 0.1% on the day. Karen Jones, Team Head FICC Technical Analysis Research at Commerzank, expects the pair to push higher again towards the 2017 high at 0.9308.

Key quotes

“EUR/GBP’s correction lower went a little further than we had hoped but remains within the realms of a correction only. We view this as the market pausing ahead of further gains to the 0.9308 2017 high and 0.9323, the 78.6% Fibonacci retracement. This is formidable resistance and it is expected to hold the initial test.” 

“We suspect that the market is consolidating ahead of another leg higher. Near-term dips will find initial support at 0.9072, the mid-August high and are likely to remain contained by the 55-day ma at 0.9038.”