- EUR/GBP continued gaining some strong traction for the fourth straight session on Thursday.
- Brexit uncertainties undermined the British pound and remained supportive of the momentum.
- Lagarde’s comments on the euro strength led to the latest leg of a sudden spike in the last hour.
The EUR/GBP cross added to this week’s strong gains and continued gaining positive traction for the fourth consecutive session on Thursday. The momentum was sponsored by the emergence of some fresh selling around the British pound amid growing fears of a no-deal Brexit.
This coupled with a strong pickup in demand for the shared currency provided an additional boost to the cross. The latest leg of a sudden spike over the past hour or so came after the ECB President Christine Lagarde said that there is no need to overreact to euro’s recent gains.
From a technical perspective, a sustained move beyond the 0.9140-50 supply zone was seen as another factor that prompted some technical buying. A subsequent move beyond June monthly swing highs, around the 0.9175 level, might have already set the stage for further appreciating move.
Meanwhile, RSI (14) on hourly charts is already flashing overbought conditions and moved on the verge of breaking above the 70 mark on the daily chart. This, in turn, warrants some near-term consolidation or a modest pullback before bulls start positioning for an extension of the positive move.
Hence, any pullback from higher levels might still be seen as a buying opportunity. This, in turn, might help limit the downside near the 0.9150-40 resistance breakpoint.
EUR/GBP daily chart
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Technical levels to watch
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