Yesterday’s wide spread down candle on the daily chart for the $uros to poundsr, signalled a short term change in sentiment,  ending the $orex tradingsion below both the 9 and 14 day moving averages, which both failed to provide any  support to the move lower. Indeed with the 9 day now crossing below the 14 day moving average this is adding further to the bearish tone indicating general weakness in the short term. This has been further confirmed in early trading this morning with the currency pair moving lower once again, and testing the deep support area immediately below in the 88.50 to 90.00 price area. The significant move yesterday has simply confirmed the weakness of the last few weeks, with the currency pair struggling to break above the 0.9150 price area, with several candles exhibiting weakness to the upside with deep shadows above the body. With the pair now pushing deeper into the congestion area, any breach of the lower support area at 88.75, could see a deeper move as a result testing support in the 0.88 zone. However, with both the 40 day and 200 day moving averages still below, the longer term outlook remains bullish, and  provided we see a bounce back with a break and hold above the recent top at 0.9150, then we should see the pair continue higher in due course , possibly to retest the 0.94 high of October in due course.

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