A descending trend channel has dominated in the case of the British pound against the euro since February 2013. Bouncing from a low at 0.788 per euro in July after three short weeks, the pound stopped short of the first Fibonacci retracement resistance level at 0.807. The way it turned down again last week, so that momentum and the moving average convergence/divergence were both bearish, represents not so much weakness in the euro as strength in the pound (the pound has gained against other currencies, too). The trend looks set to continue to the bottom of the channel at 0.78, or maybe more, because the relative strength index is not oversold, volatility is subdued and the long-term moving averages are pointing downwards.
