EURGBP-A sharp sell off and reversal of its thursday gains has resumed the cross’s weakness started from the 0.8662 leve and set the stage for further weakness. This leaves the risk of further declines towards the 0.8517 level, its Nov 18’2011 low with a push through there turning focus to the 0.8485 level, its Nov 10’2011 high. A break of here if seen will create scope for further declines towards the 0.8355 level, its Feb’2011 low and next its Jan’2011 low at 0.8284. Its daily RSI is bearish and pointing lower supporting this view. Alternatively, on a return above the 0.8662 level, further upside offensive will develop towards the 0.8794 level, its Sept 21’2011 high followed by the 0.8885 level, its Aug 10’2011 high and subsequently the 0.9083 level, its Jun 01’2011 high. All in all, the cross continues to maintain its medium term downtrend theme though hesitating.
