EUR/GBP Technical Analysis
- Bulls ease up further
- Levels and trading zones to monitor
EUR/GBP Price – Edges Lower
Last week, EUR/GBP lost some of its recent gains as more bulls seemed to cut back. On Friday, the market declined to 0.8905 then rallied after. Yet, the weekly candlestick closed in the red with 2.6% loss.
This week, the Relative Strength Index (RSI) crossed below 50, highlighting the end of uptrend move and a possible start of a downtrend momentum.
EUR/GBP DAILY PRICE CHART (Nov 1, 2018 – April 3, 2020) Zoomed Out
EUR/GBP DAILY PRICE CHART (Nov 1 – April 3, 2020) Zoomed In
Looking at the daily chart, we noticed last week EUR/GBP retreated and broke below 0.9015 generating a bearish signal. Yesterday, the market produced another bearish signal as moved to a lower trading zone 0.8687 – 0.8832.
Thus, a close below the low end of the zone could lead EURGBP towards 0.8620. Further close below that level could send the price even lower towards 0.8400. Having said that, the weekly support level underscored on the chart (zoomed in) should be kept in focus.
On the flip-side, any close above the high end of the zone could push EURGBP towards 0.9015. Further close above that level opens the door for more bullishness towards 0.9500. In that scenario, special attention should be paid to the daily and weekly resistance level and area marked on the chart, as some traders might join/exit around these points.
EUR/GBP FOUR HOUR PRICE CHART (Mar 1 – April 3, 2020)
From the four- hour chart, we noticed that on Friday EUR/GBP broke below the neckline of double top pattern located at 0.8996 eyeing a test of 0.8505. Additionally, the price broke below the uptrend line originated from the March 6 low at 0.8650 generating another bearish signal.
A break below 0.8589 increases the likelihood of EURGBP to test 0.8505. Yet, the weekly support level underlined on the chart should be considered. Any break in the other direction i.e. above 0.8880 may cause a rally towards 0.8662 . Although, the daily resistance level printed on the chart should be watched closely.
See the chart to figure out more about key technical levels the price would encounter in a further bullish/ bearish scenario.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi
