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Karen Jones, Analyst at Commerzbank, notes that the EUR/GBP saw only a brief erosion of the 55 and 200 day ma at .8834, but recovered and suggests that while it holds over .8800, the market will remain capable of retesting the topside.

Key Quotes

“We look for a retest of the .8934/41 recent highs. Above .8941 will put the July peak at .8960 back in the frame, followed by the early August and September highs at .9031/54. However given that we are currently pretty much mid-range – we have no strong bias. Slips should find support between the July low at .8799 and the November 12 high at .8774. Further support sits at the October trough at .8723.”

“Only unexpected failure at the .8655 current November low on a daily chart closing basis would probably trigger a swift drop to the April low at .8620. Below it lies the .8602 May 24 low.”