Forex

EURGBP stands near 0.8500; appears somewhat neutral in short-term

EURGBP posted strong losses on Wednesday, erasing the previous gains, and returning above the 20-day simple moving average (SMA). The bias in the short-term is appearing neutral as the price failed several times to make a daily close above 0.8585. The RSI is sloping slightly upwards in the positive region; however, the MACD is losing momentum below its trigger and zero lines.

Should the price retreat further, the 200-day SMA at 0.8437, which the bears were unable to break over the last three weeks, could provide immediate support. Moving lower, the focus will shift to the 40-day SMA at 0.8414, while lower still the 0.8380 would increase speculation that the medium-term bullish phase has ended, and a downtrend is in progress.

In the alternative scenario, traders would be eagerly looking for a break above 0.8585 to increase buying orders. If that’s the case, the rally could last until 0.8617 ahead of the 0.8660 bullish spike, taken from the peak on July 2021.

All in all, EURGBP is moving sideways in the short-term, while in the medium-term outlook, the price is showing some positive signs.  

About the author

Melina Deltas

Melina joined XM in December 2017 as an Investment Analyst in the Research department. She can clearly communicate market action, particularly technical and chart pattern setups. Her technically focused method looks mainly at price action across multiple time frames to capture big moves that develop over the years. She has more than 3 years of experience in analyzing financial markets, specializing in forex, indices, and commodities. Melina studied Pure Mathematics at Lancaster University and has a Master's Degree in Monetary and Financial Economics from the University of Cyprus. Currently, she is an associate member of the Society of Technical Analysts (STA) and a Certified Financial Technician (CFTe).

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