EUR/GBP continues ranging without a clear indication over which direction the pair wants to head after. The pair is stuck between the 0.8695 level and the 0.8840 mark. Until it breaks one of the sides on a daily-close basis, we will remain neutral on the near-term outlook. As for the bigger picture, the pair is still within the downwards moving channel, that’s running from the end of September last year.
EUR/GBP is currently testing an important area of resistance at 0.8790, a break of which could open the path towards last week’s high of around 0.8810 mark. If after that, the buying still prevails, then we could see the pair moving towards the upper side of the aforementioned range, at the 0.8840 level. If that level is not able to withhold the rate from rising, then more bulls could join in and drive EUR/GBP higher.
Looking at our oscillators, the RSI is sitting above its 50 mark, which could be seen as a bullish indication. The MACD is also showing signs of strength by moving above both its 0 and trigger line, indicating that the potential could be more to the upside.
On the other hand, a strong move lower towards the 0.8725 level and eventually a break of it, could interest the bears in driving EUR/GBP to the lower side of the aforementioned range, at the 0.8695 area. A break of that zone could open the way for a quick test of the 0.8680 territory, which if broken, could clear the path towards the bottom side of the previously mentioned downwards moving channel.
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