EUR/GBP dives to lows since September, indicators flash oversold conditions
- EUR/GBP was seen at 0.856 with a downside movement of 0.70%, it lowest since early September.
- In the daily and 4-hour chart, indicators hit oversold conditions after a seven-day losing streak.
- The cross will also close a 1.40% weekly loss.
In Friday's session, the EUR/GBP pair was seen at 0.8560 after a downward rally of 0.70%. On the daily and four-hour chart, the cross reached oversold conditions suggesting that an upwards correction may be on the horizon, but the overall trend currently favours the sellers.
The technical indicators on the daily chart are exhibiting robust bearish momentum. The pair's position beneath the 20, 100 and 200-day Simple Moving Averages (SMAs) underscores the dominant downward trend. In addition, the rising red bars of the Moving Average Convergence Divergence (MACD) concur with this downward outlook, reinforcing the influence of bearish pressure while the Relative Strength Index (RSI) is navigated into oversold territory, a sign typically associated with selling saturation which tends to be followed by an upwards correction.
Examining the four-hour chart on the shorter time frame presents similar bearish signals. The pair shows signs of oversold conditions, as evidenced by the Relative Strength Index (RSI). while the Moving Average Convergence Divergence (MACD) prints rising red bars.
Support Levels: 0.8530, 0.8515, 0.8500.
Resistance Levels: 0.8600, 0.8630, 0.8670.
EUR/GBP daily chart
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Author
Patricio Martín
FXStreet
Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.
