- EURGBP pivots higher at the bottom of a range
- Technical signals not bullish yet
- Eyes on the 0.8540 resistance zone
EURGBP switched to recovery mode after almost reaching August’s one-year low of 0.8491 and the bottom of the 2023 range area. While the area looks to be an ideal place for an upside reversal, the technical picture cannot guarantee a sustainable rebound.
According to the technical indicators, there is some persisting skepticism in the market, as the RSI is still some distance below its 50 neutral mark and the stochastic oscillator has yet to post a positive cross. Also, the MACD keeps hovering around its red signal line and remains comfortably below zero.
On the upside, the 20-day simple moving average (SMA) and the upper band of the 2024 bearish channel could pause gains around 0.8540. If the pair manages to climb that border, resistance could next develop around February’s bar of 0.8566. Then, a break above the 50-day SMA might be required for a continuation towards the 200-day SMA at 0.8618.
Otherwise, if the current positive mood in the market evaporates, the bears may push for a close below the 0.8490 support level with scope to reach the 0.8430 constraining zone and the 0.8400 psychological mark. Additional losses from there could stabilize around the August 2022 barrier of 0.8340.
In summary, EURGBP may experience some bullish movement in the coming sessions, though only a clear extension above the 20-day SMA and the 0.8540 region could strengthen the positive momentum in the price.
