Chart of the day: Upside potential for British pound
With the first round of the French presidential election over the weekend, its final round in May and a British general election in June, there is a lot at stake for both the euro and the pound. The weekly chart of the pound and the euro shows a complex head-and-shoulders-top pattern. October’s high of £0.9365 was the weakest level the pound has been against the euro zone’s single currency since 2008’s record at £0.98. The right-hand pair of shoulders are neat whereas the left ones less so. Based on the formation’s height, the first (conservatively) measured target would be £0.76 once the neckline at £0.83 is decisively broken. By its width, a second target would be £0.70. Both targets are just below the middle of its lifetime range.
Nicole Elliott is a technical analyst