- EUR/GBP extended Friday’s rejection slide from over one-month-old descending channel resistance.
- Bearish traders might now aim to test an important support near the key 0.9000 psychological mark.
- A sustained strength beyond the 0.9100 mark will now be seen as a fresh trigger for bullish traders.
The EUR/GBP cross witnessed some heavy selling on Monday and extended the previous session’s rejection slide from a resistance marked by the top end of over one-month-old descending channel.
The downfall was sponsored by a strong pickup in demand for the British pound, with bears making a fresh attempt to extend the downward trajectory further below the 100-day SMA support. The mentioned support is followed by the key 0.9000 psychological mark, which if broken decisively should pave the way for further weakness.
The EUR/GBP cross might then accelerate the slide towards challenging the trend-channel support, which is currently pegged near the 0.8930-25 region. A convincing breakthrough will be seen as a fresh trigger for bearish traders and set the stage for an extension of the recent pullback from the vicinity of the 0.9300 mark.
Meanwhile, technical indicators on the daily chart – though have been struggling to gain any meaningful traction – are still far from confirming the near-term bearish outlook. Hence, any subsequent downfall might continue to attract some dip-buying and remain limited amid persistent Brexit-related uncertainties.
On the flip side, the 0.9070 horizontal zone now seems to act as an immediate hurdle ahead of the trend-channel resistance, around the 0.9100 round-figure mark. Bulls might wait for a sustained move beyond the mentioned barrier before positioning for a move towards the 0.9155-60 intermediate resistance en-route the 0.9200 mark.
EUR/GBP daily chart
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Technical levels to watch
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