EURGBP levitated higher this week, continuing the pattern of higher highs and higher lows on the daily chart above an uptrend line drawn from the lows of February. The pair is also trading above all its simple moving averages (SMAs), all of which suggests that the outlook is bullish.
Short-term oscillators mostly concur with that assessment, as the RSI is already positive and is hovering just below its 70 line, while the MACD is above both its zero and red trigger lines.
If buyers stay in charge and manage to close above 0.9150, the next target on their radar may be the 0.9230 zone, which halted the upside move on March 26. If that’s violated too, the focus would likely shift to the 0.9320 territory that also provided resistance back in late March.
Now if the bears retake control, their first obstacle to the downside may be the 0.9055 area. If pierced, a tougher support region may be the crossroads of the 0.9000 handle and the aforementioned uptrend line. Even lower, the 50-day SMA currently at 0.8900 could halt the sellers, ahead of the 0.8865 level. For the picture to change back to a more neutral one, from bullish currently, the bears would need to close below 0.8865.
Summarizing, the outlook seems firmly positive. For that to be called into question, sellers need to punch below 0.8865.
