EUR/GBP Price Analysis: Jumps back above 0.9100 mark, lacks follow-through ahead of BoE
|- EUR/GBP rebound from the 50% Fibo. level support, around the 0.9085-80 region.
- Any further move up might confront resistance near the 0.9135-40 confluence area.
- Sustained weakness below the 0.9085-80 zone needed to confirm further weakness.
The EUR/GBP cross staged a modest intraday bounce from the 0.9085-80 support area and refreshed daily tops during the early European session. The mentioned support marks the 50% Fibonacci level of the 0.8866-0.9292 positive up and should now act as a key pivotal point for short-term traders.
Slightly oversold conditions on the 1-hourly chart seemed to be the only factor that prompted some short-covering move and pushed the cross back above the 0.9100 round-figure mark. However, the lack of any strong follow-through buying warrants some caution before placing fresh bullish bets.
Hence, any subsequent move up is more likely to confront a stiff resistance and remain capped near the 0.9130-35 confluence barrier – comprising of 200-hour SMA and the 38.2% Fibo. level. That said, a sustained strength beyond will indicated that the recent corrective slide is over.
The cross might then accelerate the positive move towards the 23.6% Fibo. level, around the 0.9190 region. A subsequent move back above the 0.9200 mark will be seen as a fresh trigger for bullish traders and lift the cross further towards the 0.9260 horizontal resistance.
On the flip side, the 0.9085-80 region (50% Fibo. level) might continue to act as immediate support and protect the downside. Failure to defend the mentioned support might turn the cross vulnerable to prolong its retracement slide from the vicinity of the 0.9300 mark, or six-month tops.
EUR/GBP 1-hourly chart
Technical levels to watch
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