EUR/GBP has been trading within a short-term sideways range since the 18th of April, between 0.8695 and 0.8840, and thus we will hold a flat stance with regards to the short-term outlook for now. However, as far as the broader picture is concerned, the pair is still trading within the downside channel that’s been containing the price action since the last days of September.
On Friday, the bears took charge from slightly above 0.8800 and pushed the rate lower. If that momentum continues today as well, then we may see them aiming once again for the 0.8695. A clear dip below that level could set the stage for the 0.8620 support, defined by the low of the 17th of April, or the lower end of the aforementioned medium-term channel.
On the other hand, if the bulls prove to be stronger than the bears then we could see them targeting the aforementioned range’s upper bound soon, at 0.8840, the break of which could open the way for the 0.8900 resistance zone, or the upper side of the broader channel.
Taking a look at our short-term momentum indicators, we see that the RSI has been oscillating around 50 since the 18th of April, while the MACD lies near both its zero and trigger lines, pointing sideways. These momentum signs support the near-term flat picture marked by the range between 0.8695 and 0.8840.
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