- EUR/GBP added to its heavy intraday losses moved further away from Friday’s multi-month tops.
- The intraday downfall found some support near 50% Fibo. amid oversold RSI on the 1-hourly chart.
- The set-up still seems tilted in favour of bulls and warrant caution before placing fresh bearish bets.
The EUR/GBP cross maintained its heavily offered tone through the mid-European session and refreshed daily lows, around the 0.9045 region in the last hour. The downfall dragged the cross further away from near three-month tops, around the 0.9230 region touched on Friday.
However, slightly oversold RSI on the 1-hourly charts assisted the cross to find some support near the 50% Fibonacci level of the 0.8867-0.9230 recent strong move up. This is followed by a multi-week-old ascending trend-line support near the 0.9030-25 region, which if broken will set the stage for further weakness.
Meanwhile, technical indicators on the 4-hourly chart have just started gaining negative traction. However, oscillators on the daily chart – though have been losing positive momentum – are still holding in the bullish territory and support prospects for the emergence of some dip-buying at lower levels.
This warrants some caution for aggressive bearish traders. Hence, it prudent to wait for some strong follow-through selling below the mentioned trend-line support before confirming that the EUR/GBP cross has topped out in the near-term and positioning for any further depreciating move below the key 0.9000 psychological mark.
The latter coincides with the 61.8% Fibo. level, below which the EUR/GBP cross seems all set to accelerate the fall towards the 0.8950-45 horizontal support. The downward trajectory could further get extended and has the potential to drag the cross back towards testing sub-0.8900 levels in the near-term.
On the flip side, any attempted move up might now confront immediate resistance near the 0.9100 round-figure mark (38.2% Fiibo. level) ahead of daily swing highs, around the 0.9120 region. A sustained move beyond might negate the bearish bias and assist the EUR/GBP cross to aim back to reclaim the 0.9200 mark.
EUR/GBP 1-hourly chart
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Technical levels to watch
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