EUR/GBP Looks to be Heading Towards 0.8675 Again


EUR/GBP traded in a consolidative manner on Friday and during the Asian session Monday, staying slightly above the 0.8635 support. That said, some bulls woke up during the European trading and they now seem to be heading towards the 0.8675 hurdle, which has been acting as the upper bound of the sideways range that’s been containing most of the price action since February 25th. Overall, given that EUR/GBP is still within the range, we prefer to maintain our neutral stance, and we would like to wait for a move above 0.8675 before we get confident on more upside extensions.

A clear break above 0.8675 could confirm the upside exit out of the aforementioned range and could initially set the stage towards the 0.8725 area, fractionally below the peak of February 22nd, and near the high of March 21st. That zone was also a decent support between January 30th and February 19th, when it was broken to the downside. Another break, above 0.8725, could carry more bullish implications, perhaps paving the way towards the 0.8765 hurdle, near the highs of February 18th and 19th.

Looking at our short-term momentum studies, we see that the RSI turned up from near its 50 line, but the MACD is still sitting near both its zero and trigger lines, pointing sideways. Although the RSI supports somewhat the notion for further advances, the flat MACD enhances our choice to wait for a move above 0.8675 before we start examining whether the bulls have taken the driver’s seat.

On the downside, a decisive slide below 0.8620 may signal that traders want to keep this exchange rate range-bound for a while more. The bulls could abandon the field, allowing the bears to take the reins and push the rate lower within the broader range. We could see declines towards the 0.8590 area, defined by the lows of April 8th and 10th, the break of which could extend the fall towards the low of April 5th, at around 0.8556.

EURGBP

 


JFDBANK.com - One-stop Multi-asset Experience for Trading and Investment Services


The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. JFD Group, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD Group analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD Group prohibits the duplication or publication without explicit approval.

78% of the retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure: https://www.jfdbank.com/en/legal/risk-disclosure

Analysis feed

Latest Forex Analysis

Editors’ Picks

GBP/USD: Brexit hopes maintain Sterling afloat

The GBP/USD pair hit a daily high of 1.2918 on Friday, boosted by news indicating that the  Brexit Party has decided to step down from 43 additional constituencies where Labour won, facilitating the way for a Conservative majority.

GBP/USD News

EUR/USD: Recovery could continue in the short-term

The EUR/USD pair has recovered some ground Friday, ending the week with modest gains at around 1.1050. The American dollar extended its slide as speculative interest couldn’t find a reason to keep on buying it. 

EUR/USD News

USD/JPY: Pressuring resistance but without enough strength

The USD/JPY pair trimmed part of its weekly losses last Friday, closing the week in the red at around 108.80. Demand for safe-haven assets eased despite persistent tensions between the US and China.

USD/JPY News

US Dollar Index challenges weekly lows near 98.00

The US Dollar Index (DXY), which gauges the buck vs. a bundle of its main rivals, is now accelerating the downside and threatens to test the key support at 98.00 the figure.

US Dollar Index News

Trump Impeachment: Markets will not like any replacement

The public phase of the impeachment hearings against President Donald Trump has kicked off, with the US public and parties divided more than ever. How does it affect markets?

Read more

Forex Majors

Cryptocurrencies

Signatures