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EURGBP tests key cluster of support on the daily chart. What is in play?


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Lots of support at 0.8860 area

Be aware.
The EURGBP has a bunch of support at the 0.8860 area on the daily chart:

  • The 100 day MA is at 0.8860
  • A trend line connecting April 17 and June 21 low comes in at 0.8866
  • The 50% of the move up from the April 17th low come in at 0.8859

The low today reached 0.88608.
The price is up to 0.8878 currently.
Risk focuses traders will always look to lean against levels where risk can be defined and limited. The 0.8859-66 area in the EURGBP is a cluster of support that is attracting buyers. Look for the dip buyers to continue to buy on dips toward “the cluster” until proven wrong (i.e., a break).  
Looking at the hourly chart, the technical picture looks more bullish on a break of the 100 and 200 hour MA and the topside trend line (see lower yellow area).  There was a run higher after the Brexit headlines earlier today, and that run tested the topside trend line (see red circle 3) but the price backed off.   Getting back above that area (from 0.88937 to 0.8913) would be a step in the bullish direction. 

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