EURGBP

[Mercury]

EURGBP has undergone the retrace I was looking for and must now be a candidate for a turn back down.  The Daily chart shows a significant rally ending turn back in on 7 Apr and the Weekly suggests a drop to and probably beyond 7000.  The retrace could have another leg, coul make it up near 8000 resistance for right now it is at Fib 50% and coincides with W4 end (of the previous bear move) a strong likelihood turning point.  So Shorts here but either with tight stops or very long stops out beyond 8000 seems to be the order of the day.  With GBP and EUR turning vs USD it appears to be a race to the bottom between these two.  The technical analysis suggests the Euro will win that race...  Despite the Brexit alleged uncertainty I would rather be in GBP than Euros right now...  And anyway there is as much or more uncertainty about the EU on the UK leaving than about what happens to the UK itself I think...

 



[Rocketman]

Interesting analysis Mercury - and as comprehensive as always with the charts.

 

FWIW - the next few hours will tell - either way it will be a great ride.

 

The Brexit is a real interesting one - the Europeans dont want it as it would effectivley end "Europe" - who will pick up our tab?  - not even those Germans have the Leiderhosen pockets deep enough, the French will shrug their shoulders, the Italians and Spanish will put their hands up and claim they have no money and sulk and blame the Brits and the Greeks. The Greeks will want their Marbles back ( again) and the rest will be too busy rebuilding their borders to do anything.

 

The next few weeks will be very interesting and we wil probably end up celebrating even more Shakespeare - " Much ado about nothing"!

 

hee hee

[Mercury]

EURGBP turns in or around the 50% Fib and assciated Resistance to resume its downward course.  Should be a decent Bear run on this one now.

 



[Mercury]

Has EURGBP just completed an EW1-2 retrace?  If so it is heading into a long and strong wave 3 down.  Good time to chance a Short?

 



[Mercury]

Just as with GBPUSD if you are heading to Europe on holidays maybe buy Euros now?  We have had a nice run down and retrace on this cross recently but what is emerging on the Daily is interesting perhaps.  We have the Neg Mom Div at the previous top (I believe it to be a top) and you can see the retrace in EW1-2 form but the interesting part is the head & shoulders formation being described.  I only really like H&S at true Tops and Bottoms, otherwise they can give false signals but as this is, for me, a top I and keenly awaiting the completion of the H&S formation as that will signal a significant drop.  Ont he way there will be twists and turns for sure, maybe a nice kiss back on the neckline after a break?  Who knows just yet but long term it all looks set for a drop.  Perhaps Brexit threats will be worse for the EU than the UK?

 

Looking also at the Weekly chart you can see price has hit the long term upper tramline at the underside of the Fib 38%, which runs along a good Support/Resistance zone.  The EW count is a bit hard to fit and there are alternatives but all of them suggest a sustained break lower to at least the lower tram is my guess (circa 6800).