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- EUR/GBP holds lower ground at monthly bottom, extends pullback from 50-DMA.
- Lower-high formation keeps sellers hopeful amid bearish MACD signals.
- 2.5-month-old ascending support line, 100-DMA lures bears during further downside.
- Bulls need validation from three-week-long falling resistance line.
EUR/GBP remains depressed around 0.8790, refreshing the monthly low, as traders brace for Tuesday’s European session. In doing so, the cross-currency pair extends the previous day’s pullback from the 50-DMA hurdle amid bearish MACD signals.
Also keeping the EUR/GBP sellers hopeful is the pair’s lower high formation, as portrayed by a three-week-old descending resistance line surrounding 0.8850 by the press time.
That said, the pair sellers appear well-set to drop towards an upward-sloping support line from December 19, 2022, close to 0.8760. However, the pair’s further downside is likely to be limited by the 100-DMA support level near 0.8750.
In a case where the cross-currency pair remains weak past 0.8750, the lows marked in January 2023 and late December 2022, respectively near 0.8720 and 0.8690, could act as additional downside filters.
Meanwhile, EUR/GBP recovery remains elusive unless the quote stays below the 50-DMA hurdle of 0.8831.
Even if the quote rises past 0.8831, the aforementioned three-week-old resistance line could challenge the pair buyers near 0.8850.
Following that, the mid-February swing high surrounding 0.8930 appears the last defense of the EUR/GBP bears.
EUR/GBP: Daily chart
Trend: Further downside expected