EUR/GBP Price Analysis: Extends pullback from weekly resistance towards 0.8500
- EUR/GBP refreshes intraday low, grinds higher around 20-SMA.
- Receding bearish bias of MACD, firmer RSI line keeps buyers hopeful.
- Eight-day-old support line, 200-SMA restrict short-term downside.
EUR/GBP remains on the back foot around daily lows near 0.8535, down 0.07% intraday ahead of the UK jobs report, up for publishing amid early Tuesday.
Also read: When are the UK jobs and how could they affect GBP/USD?
The cross-currency pair’s latest pullback could be linked to the failure to cross a one-week-old resistance line and the 20-SMA. However, easing the bearish bias of the MACD and steady RSI hints at the further upside of the quote.
That said, a clear run-up beyond the nearby SMA and trend line resistance, around 0.8540 and 0.8550 respectively, will become necessary for the EUR/GBP bulls to retake controls.
Following that, 0.8575 and the monthly peak surrounding 0.8600 will be crucial to watch.
Alternatively, further weakness will aim for an ascending trend line from December 02, at 0.8500 by the press time.
It should be noted, however, that a clear downside break of the 0.8500 threshold will confirm a head-and-shoulders bearish chart pattern, which in turn directs EUR/GBP sellers towards late November lows near 0.8485.
Though, the 200-SMA level of 0.8492 will act as a validation point for the downside.
EUR/GBP: Four-hour chart
Trend: Further upside expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
