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FX TECHNICAL ANALYSIS EUR/GBP


EUR/GBP re corded an a l l - t ime traded high at .9801 in De c ember 2008, be fore undergoing a choppy re t re at to .8400 in June 2009, where a .8400 / .8458 ba s e wa s t ra c ed out . Ga ins f rom .8400 / .8458 f a i l ed to bre ak the Januar y & March 2009 lower tops at .9518 & .9478, be ing capped at .9411 in Oc tober 2009, f rom where a re turn to we akne s s commenc ed. The Januar y 2010 bre akdown through the November 2009 higher low at .8833 and the 15 month uptrend conne c t ing .7695 & .8458 added to f e ar s that .9411 marked a s igni f i cant lower top for a fur ther re tra c ement of the mul t i -ye ar r i s e s f rom the 2000 & 2007 bot toms at .5684 & .6537. Sinc e then, the 2009 ba s e at .8400 / .8458 ha s g iven way and a de ad- cros s of the ( red & g re en) 13 & 52 we ek moving avera g e s ha s


more re c ent ly oc cur red. A batch of Fibona c c i re tra c ement s are s e en around the .8169- .8228 are a , but we s e e an extens ion through that suppor t reg ion towards the .8000- .8010 are a ini t i a l ly ( ps ycholog i ca l suppor t / me a sured move – 100% of the .9801- .8400 de c l ine f rom the .9411 lower top) wi th another batch of Fibona c c i suppor t s at .7742- .7784 and the .7649- .7695 reg ion (ul t ra - long (blue ) 260 we ek (5 ye ar ) moving avera g e / Oc tober 2008 low) of f er ing the next targ e t zone s be low there . On the ups ide , we s e e suppor t - turned- re s i s tanc e around the .8807- .8833 are a a c t ing a s a sol id cap to re cover y at tempt s over coming we eks , wi th the 18 month downtrend l ine conne c t ing .9801 & .9411 (now at .9088) a fur ther bar r i er above there .


54 FX TRADER MAGAZINE July - September 2010


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