The cross extends strong recovery rally from 0.8745 low (27 Sep) into the second day.
Fresh bullish acceleration on Monday, driven by weaker pound, broke above 10 SMA at 0.8813 and hit high at 0.8868 (the highest since 22 Sep).
Bulls can extend to next barriers at 0.8893/98 (100SMA/19 Sep higher low), where the price may face stronger headwinds.
Overall picture is bearish, with current rally seen as correction of larger 0.9306/0.8745 descend and positioning for fresh downside.
Corrective rallies should be ideally capped at 0.8900 zone before bears resume, however, stronger correction cannot be ruled out as daily indicators are heading north and showing further space at the upside. Sustained break above 0.8900 barrier would generate bullish signal for stronger correction, while break above 0.8960 (Fibo 38.2% of 0.9306/0.8745) is needed to confirm scenario and put underlying bears on hold. Broken 10SMA marks pivotal support (currently at 0.8813) and return below here would signal an end of corrective phase and shift focus towards key supports at 0.8742/45 (14 July trough/27 Sep low).
Res: 0.8868; 0.8898; 0.8915; 0.8960
Sup: 0.8841; 0.8800; 0.8742; 0.8719
