Today’s pound move has been all about the quid rather than the euro or the dollar and although we’ve taken a beating from some dovish BOE comments, and are suffering at the hands of a slowdown in the latter part of the year, we’re still very much ahead of the european pack as far as fundamentals go.
On this purely pound based cable move, I’m inclined to trade against it but I’m not confident of going against it in GBP/USD, so I’ve been keeping tabs on EUR/GBP.
We’ve been up to resistance at 0.7850 after bouncing from just ahead of the July 2012 lows around 0.7745/50.
EUR/GBP H4 chart 02 10 2014
I was hoping for a test of those lows before looking to take off some of my shorts but the “don’t be a dick for a tick” mentality has reared its ugly head once more and we’re nearly 100 pips higher. While I would have preferred to unload some before adding to shorts again, I’ve done so anyway up here on the test of 0.7850. There’s a stronger level at 0.7885/90 and if that breaks I’ll think about taking some off the table.
