Skip to content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
EUR/GBP Outlook: Brexit Risks May Push Pair Past Key Resistance

EUR/GBP Outlook: Brexit Risks May Push Pair Past Key Resistance

Dimitri Zabelin, Analyst

Euro Outlook, Brexit Latest, EUR/GBP Technical Analysis

  • EUR/GBP hovering at key resistance
  • Break or capitulation ahead for pair?
  • Brexit woes may be crucial catalyst

Learn how to use political-risk analysis in your trading strategy!

As outlined in last week’s forecast, EUR/GBP cautiously climbed towards critical resistance at 0.8917 after the pair gapped below it on September 13 as part of a broad downtrend after reaching multi-year highs in August. If this is indeed a reversal of the pair’s descent, clearing 0.8917 will be crucial, though recent price action indicates traders are not yet confident to continue higher.

EUR/GBP – Daily Chart

Chart showing EUR/GBP

EUR/GBP chart created using TradingView

The extended wicks suggest a shy yearning to break above the psychological barrier, though ultimately the closes below it signal a lack of resolve. If EUR/GBP continues to fail to breach resistance, the pair may capitulate and retreat below 0.8874.

Looking at a monthly chart, the pair is hovering in a familiar mid-range zone that is inside a broad congestive area that developed after the Brexit referendum in 2016. The relatively directionless movement of the pair since then reflects the uncertainty about the EU-UK divorce.

EUR/GBP – Monthly Chart

Chart showing EUR/GBP

EUR/GBP chart created using TradingView

Looking ahead, if Brexit woes prevail and undermine confidence in the United Kingdom’s future, GBP will likely fall against its major counterparts and could be a key catalyst behind pushing EUR/GBP past resistance. However, traders may choose to remain neutral and not add exposure until more there is more political clarity.

EUR/GBP TRADING RESOURCES

--- Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com

To contact Dimitri, use the comments section below or @ZabelinDimitrion Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES