EUR/GBP Forecast, Euro, British Pound Analysis – TALKING POINTS
- EUR/GBP outlook suggests the pair could experience a bullish breakout
- Signs showing pair is bottoming out after aggressive selloff since August
- EUR/GBP still has to shatter what has shown to be formidable resistance
EUR/GBP TECHNICAL OUTLOOK
EUR/GBP has risen a little over one percent since it bounced back from the late-January support at 0.8389 (gold-dotted line) and is now testing resistance at 0.8533 (white-dotted line). Clearing this ceiling opens the door for a third retest of a formidable, multi-tiered resistance zone defined by the 0.8597-0.8642 price parameters (labelled as “key resistance range”).
EUR/GBP – Daily Chart
EUR/GBP chart created using TradingView
As noted on the chart, the pair attempted to shatter this barrier twice in December 2019 and mid-January of this year. However, both times EUR/GBP capitulated and faced a bout of selling pressure until it bottomed out. Looking ahead, a third defeat could catalyze a comparatively more aggressive decline if it reinforces the notion that traders are not yet confident in the pair’s ability to climb beyond this point.
EUR/GBP – Monthly Chart
EUR/GBP chart created using TradingView
Looking at a monthly chart shows a relatively more encouraging picture for EUR/GBP bulls. After declining almost eight percent since August 2019 and retreating to a three-year support zone, the pair could be showing signs of a recovery. However, surmounting resistance outlined in the prior paragraph may be critical in propelling EUR/GBP higher. This is also not considering Brexit volatility which could skew the trajectory.
EUR/GBP TRADING RESOURCES
- Tune into Dimitri Zabelin’s webinar outlining geopolitical risks affecting markets in the week ahead !
- New to trading? See our free trading guides here !
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--- Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com
To contact Dimitri, use the comments section below or @ZabelinDimitri on Twitter