EUR/GBP Price Analysis: Daily RSI signals overbought conditions for first since March

EUR/GBP's recent 400 pip rally looks overdone as per the 14-day RSI.
The overbought reading needs validation from the price chart.

Omkar Godbole FXStreet Contributor

EUR/GBP jumped more than 1.6% on Thursday to 0.9270, the highest level since March 25.

The pair has rallied by 400 pips in the past seven trading days, primarily due to renewed Brexit concerns.

The sharp rally looks overdone, according to the 14-day relative strength index. The indicator has crossed into overbought territory above 70 for the first time since March.

However, there are no signs of uptrend exhaustion on the price chart. Besides, indicators can stay overbought for a long time in a strong trending market. As such, the bias remains bullish.

That said, a minor pullback to the former hurdle-turned-support at 0.9176 (June 29 high) may be seen before further gains. That's because there are signs of bull fatigue on the hourly and 4-hour charts.

Daily chart

Trend: Bullish

Technical levels

EUR/GBP

Overview
Today last price	0.9237
Today Daily Change	0.0011
Today Daily Change %	0.12
Today daily open	0.9226

Trends
Daily SMA20	0.8995
Daily SMA50	0.9021
Daily SMA100	0.8967
Daily SMA200	0.8796

Levels
Previous Daily High	0.9271
Previous Daily Low	0.9075
Previous Weekly High	0.8967
Previous Weekly Low	0.8866
Previous Monthly High	0.907
Previous Monthly Low	0.8909
Daily Fibonacci 38.2%	0.9196
Daily Fibonacci 61.8%	0.915
Daily Pivot Point S1	0.9111
Daily Pivot Point S2	0.8996
Daily Pivot Point S3	0.8916
Daily Pivot Point R1	0.9306
Daily Pivot Point R2	0.9386
Daily Pivot Point R3	0.9502

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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