XM does not provide services to residents of the United States of America.

Technical Analysis – EURGBP back in bearish mode

EURGBP resumed its bearish direction after a short period of trading sideways, falling to a new five-month low of 0.8624 on Wednesday.

Market sentiment weakened following the rejection near the 20-day simple moving average (SMA) and there might be more selling activity in the short term given the negative trajectory in the momentum indicators. Still, with the price trading near the lower Bollinger band at 0.8630 and the RSI testing its 2022-2023 lows, a pause in the ongoing bearish action or an upside correction could be possible.

The former constraining zone of 0.8615, which acted both as support and resistance in the second half of 2022, could be the last chance for pivoting higher before the price potentially revisits the lower boundary of the bearish channel and its 2022 lows within the 0.8570-0.8555 zone.

In the event of an upside reversal above 0.8645, the bulls may push towards the 20-day SMA at 0.8690. If they crawl above the 0.8700-0.8725 border too, the door will open for the 200-day SMA and the channel’s upper band at 0.8762.

Note that the 50-day SMA is looking to cross below the 200-day SMA for the first time since January 2021, signaling a continuation of the current negative trend in the price.

In a nutshell, the bearish wave in EURGBP could gain new legs in the short term. Some congestion could emerge around 0.8615 before selling forces resurface.

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.