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  • EUR/GBP formed a strong base near 200-hour SMA and jumped to fresh weekly tops.
  • The technical set-up already seems to have shifted back in favour of bullish traders.
  • RSI on the 1-hourly chart warrants some caution before placing fresh bullish bets.

The EUR/GBP cross caught some fresh bids during the early North American session and shot to fresh weekly tops, around the 0.9085 region in the last hour.

The momentum marked a bullish breakout through a two-day-old trading range around 200-hour SMA and pushed the EUR/GBP cross beyond the overnight swing highs. A subsequent strength beyond the 50% Fibonacci level of the recent pullback from the 0.9215-20 double-top resistance might have already set the stage for additional gains.

The constructive outlook is further reinforced by the fact that technical indicators have again started gaining positive traction on 4-hourly/daily charts. However, RSI on the 1-hourly chart is holding near the overbought territory and warrants some caution before positioning for any further intraday appreciating move.

That said, the EUR/GBP cross still seems poised to build on its recent bounce from one-month tops, around the 0.8930 region touched last Thursday. Hence, some follow-through positive move beyond the 0.9090 congestion zone, en-route the 61.8% Fibo. level, just above the 0.9100 round-figure mark, now looks a distinct possibility.

On the flip side, the 0.9055 horizontal level now seems to protect the immediate downside. This is closely followed by the 38.2% Fibo. level and 200-hour SMA, currently near the 0.9025 region. Failure to defend the mentioned support levels will negate the positive outlook and turn the EUR/GBP cross vulnerable to slide further.

EUR/GBP 1-hourly chart

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Technical levels to watch