EUR/GBP Price Analysis: Struggles near weekly lows, around 0.8625 region


  • EUR/GBP has been oscillating in a narrow trading band over the past one week or so.
  • The set-up still seems tilted in favour of bearish traders, albeit warrants some caution.
  • A sustained move beyond the 0.8700 mark is needed to negate the bearish outlook.

The EUR/GBP cross edged lower for the second consecutive session on Thursday and was last seen hovering near the lower boundary of its weekly trading range, around the 0.8625 region. The recent price action over the past one week or so has been confined in a narrow trading band, which seemed to constitute the formation of a rectangle on short-term charts.

A rectangle is a continuation pattern that marks a brief pause during a well-established trend. Given the recent sharp pullback from levels beyond the 0.9200 mark, the set-up favours bearish traders. The negative outlook is reinforced by the fact that last week's attempted bounce from near one-year lows faced rejection near the 0.8700 horizontal support breakpoint.

Meanwhile, the RSI (14) indicator on the daily chart is holding closer to the 30 mark, which marks oversold conditions. This seemed to be the only factor holding traders from placing fresh bearish bets and should help limit any further downside for the EUR/GBP cross. That said, sustained weakness below the weekly trading range will mark a fresh bearish breakdown.

The EUR/GBP cross might then turn vulnerable to weaken further below the 0.8600 round-figure mark. The downward trajectory has the potential to drag the cross back towards multi-month lows, around the 0.8540 region touched on February 24.

On the flip side, the 0.8665 region now seems to have emerged as an immediate strong hurdle. A sustained move beyond might trigger a short-covering move and assist the EUR/GBP cross to make a fresh attempt towards reclaiming the 0.8700 mark. Some follow-through buying will set the stage for a further near-term recovery towards the 0.8775-80 supply zone.

A subsequent strength above the 0.8800 mark will suggest that the EUR/GBP cross has bottomed out in the near-term and pave the way for some meaningful recovery in the near-term.

EUR/GBP 4-hourly chart

fxsoriginal

Technical levels to watch

EUR/GBP

Overview
Today last price 0.8627
Today Daily Change -0.0019
Today Daily Change % -0.22
Today daily open 0.8646
 
Trends
Daily SMA20 0.8696
Daily SMA50 0.8838
Daily SMA100 0.8927
Daily SMA200 0.8983
 
Levels
Previous Daily High 0.8668
Previous Daily Low 0.8622
Previous Weekly High 0.8731
Previous Weekly Low 0.8539
Previous Monthly High 0.886
Previous Monthly Low 0.8539
Daily Fibonacci 38.2% 0.864
Daily Fibonacci 61.8% 0.865
Daily Pivot Point S1 0.8623
Daily Pivot Point S2 0.86
Daily Pivot Point S3 0.8577
Daily Pivot Point R1 0.8668
Daily Pivot Point R2 0.8691
Daily Pivot Point R3 0.8714

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Get Weekly Crypto trade ideas!  
Empower yourself with the best market insights

Join FXStreet Premium!    

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD attempts recovery above 1.1950 as USD resumes decline

EUR/USD is attempting a recovery above 1.1950 ahead of the European open, as the US dollar’s rebound falters amid persistent weakness in the Treasury yields. Easing concerns over EU's covid vaccines rollout and dovish Fed expectations underpin the spot.

EUR/USD News

GBP/USD recaptures 1.3850 as UK’s optimism offsets USD bounce

GBP/USD rises above 1.3850, picking up fresh bids heading into the London open. The cheers the UK’s advantage of faster vaccinations and unlock guidelines to shrug off the US dollar’s bounce off late the lowest since late March.

GBP/USD News

XAU/USD buyers attack six-week-old resistance line around $1,780

Gold keeps recovery moves from intraday low to print mild gains, picks up bids off-late. Ascending resistance line from early March tests bulls. 50-day SMA, monthly support line could offer bounces in case of pullback, any further weakness will recall the bears.

Gold News

Bitcoin network hash rate drop may not have caused BTC price crash

China’s prominent regions for Bitcoin mining have suffered an electrical grid blackout, causing Bitcoin’s hash rate to decline. Bitcoin price crashed over the weekend, coinciding with the drop of the network’s hash rate.

Read more

S&P 500 Week Ahead: Banks beat the street, COIN booms as funds flow to ETFs

Equity markets continue to remain bolstered from all sides as the macro environment produces strong numbers, earnings continue to smash estimates and inflation concerns take a back seat. Earnings season switches from bank stocks to reopening plays.

Read more

Forex MAJORS

Cryptocurrencies

Signatures