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FX TECHNICAL REPORT MAJOR CROSS-RATES - FEATURED MARKET - EUR/GBP


EUR/GBP extended the advance from .5684 in 2000 to a peak of .9801 in December 2008, before undergoing a choppy retreat to reach .7757 in July 2012, this being between the 50% & 61.8% retracements of the rises from .5684 & .6537 in May 2000 & January 2007. Recovery attempts from .7757 have double topped at .8812 & .8769 over recent months, failing to sustain a break-out from the (orange) 4 year bear channel, with the highs being at the top of the slightly shallower (green) bear channel connecting the 2010 & 2012 lows at .8069 & .7757 with the 2011 lower top at .9083. With MACD remaining in bearish territory at this stage, we see the risk of a retreat to


retest former support in the .8069-.8222 area over coming months. Successfully holding around that former support area would be encouraging for bulls, but a subsequent lower top by .8504-.8607 (former resistance / mid-point of recent consolidation) would keep alive the possibility of a further retreat to retest the 2012 low at .7757, extending down towards the (purple) 13 year uptrend line (now at .7376, rising .0010 per month) on a break, possibly the 61.8% / 76.4% retracements of the longer-term rises at .7257-.7307. To improve, we need to see the recent .8769- .8812 double top cleared, in which case a return towards the 2011 lower top at .9083 may commence.


MAJOR TRENDS AND TARGETS FOR MAJOR CROSS-RATES As at 16 September EUR/GBP GBP/JPY EUR/JPY EUR/CHF EUR/NOK EUR/SEK


Current level .8385


157.50 132.00 1.2370 7.8790 8.6670


Major trend Flat Up Up


Flat Up


Flat


Major targets


163.07 / 168.18 139.14 / 150.51


8.2551 / 8.5664


Trend change level .8069 / .8812 137.97 111.42


1.2003 / 1.3239 7.4647


8.2561 / 9.1691


82 FX TRADER MAGAZINE October - December 2013


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