EUR/GDP Could Hit Parity - Or Correct

Includes: ERO, GBB
by: Kathy Lien

As you know, I have been very bullish EUR/GBP this week. On Monday, I showed you this chart of EUR/GBP and told you that is headed for 90 cents from 87 cents and today it has pretty much reached that level. The high in EUR/GBP was 0.89978, 2.2 pips from my 0.90 target.

One of the questions asked in the comment section of my blog earlier this morning was “Is it time to sell near .90 or will it continue to slowly go up?”

As you can see in the chart below, the retracement off the 90-cent high was pretty brutal. Although I think that EUR/GBP could hit parity, we may be due for an even larger correction that could take the currency pair back to 0.8750.