EUR/GBP trades neutral, with bulls struggling despite defending 200-day SMA
- The EUR/GBP trades largely unchanged at 0.8670 after falling beneath the 200-day SMA to 0.8645.
- Signals from the daily chart's RSI and MACD are mixed but hint at waning buying momentum.
- Despite the short-term negative outlook, SMA's position supports an overall bullish bias.
In Tuesday's session, the EUR/GBP hovered around 0.8670 with slight losses after finding support at a low of around 0.8645. On the daily chart, buyers and sellers struggle for control with a neutral to bullish outlook, even as the bull's momentum flattens. However, a glance at the four-hour chart shows indicators have flattened, suggesting a potential tilt to the downside.
In line with that, the indicators on the daily chart reflect a flat Relative Strength Index (RSI), hovering comfortably within the positive zone, which typically suggests an upward momentum, while the Moving Average Convergence Divergence (MACD) is exhibiting a diminishing pattern of green bars, signaling a bearish momentum despite remaining in a bullish sector.
However, overriding these short-term cues, the overall trend seems to be governed by the bullish force, owing to the pair's placement above its crucial 20, 100, and 200-day Simple Moving Averages (SMAs). This portrays a possibility of the bulls retaining, at least for now, a reasonably strong foothold despite having shed some ground recently. The fact that the bulls defended the 200-day average also suggests that the outlook is still positive for the cross.
Switching to the four-hour chart it presents more of a bearish setting. The indicators project sideways movement with a downcast tilt, indicating a limited upward potential. Distinctly, the four-hour Relative Strength Index (RSI) is in negative territory, while Moving Average Convergence Divergence (MACD) prints flat red bars.
EUR/GBP daily chart
-638398278567822193.png&w=1536&q=95)
Author
Patricio Martín
FXStreet
Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.
