European shares retreated on Friday from their 5-1/2-month highs in the previous session as major stock index neared an "overbought" territory, while mining shares fell after a survey showed China's factory activity likely fell in January, Reurters reported. Miners, which generally suffer in a difficult economic environment, were the worst performers, with the STOXX Europe 600 Basic Resources index down 0.9 percent. "We are right at the top of the range and will face technical pressure. I expect to see selling," said Joe Rundle, head of trading at ETX Capital. By 0820 GMT, the pan-European FTSEurofirst 300 index of top shares was down 0.2 percent at 1,044.67 points after hitting its highest since early August on Thursday. The FTSEurofirst 300 index was also nearing "overbought" levels, with its Relative Strength Index (RSI) - a technical momentum indicator that determines overbought and oversold conditions - having hit 68.7. Seventy and above is considered "overbought".
