The EUR/GBP in the 4-hour chart is starting to test the resistance levels of its recent 2-week ranging action. The implication is that if we break above the 0.85 handle that the pair maybe able to recapture some of the losses it suffered during August and September. Since bottoming out the pair has seen a fair deal of consolidation, but with key event risk out of the way (US shutdown/debt ceiling and even the most recent NFP) the pair may decide to pick a direction. We can see that the 0.85 handle is a key pivot as it was an area of support during the middle part of August, and therefore a break there would open up a move back towards 0.8575 and perhaps higher.However if that resistance holds, and the macro data favors a return to GBP strength, then it presents a good risk to reward ratio for any shorts. - Nick