DAILY STUDIES APPROACHING OVERSOLD; LOOK TO BUY
Eur/Gbp: The cross has been in the process of undergoing some significant depreciation over the past several weeks, with the market dropping to fresh 2009 lows below psychological barriers at 0.8500 thus far. However, as much as we favor continued weakness over the longer-term, shorter-term studies are starting to show the need for some upside,with daily studies approaching oversold levels and in need of a healthy corrective bounce. There is some decent congestion in the 0.8400 dating back to November 2008, and as such, we will look to use any additional dips into the lower 0.8400’s on Monday, as an opportunity to establish a counter-trend long. Strategy: BUY @0.8440 FOR AN OPEN OBJECTIVE, STOP @0.8320. Recommendation to be removed if not triggered by NY close (5PM ET) on Monday.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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