Search ForexCrunch
  • Bulls failed to capitalize on the recent recovery move from multi-month lows.
  • Weakness below 0.8800 mark will shift bias back in favour of bearish traders.

The EUR/GBP cross failed to capitalize on its recent bounce from near four-month lows and faced rejection near the 0.8900 handle – a confluence barrier comprising of 200-day EMA and 50% Fibo. level of the 0.8490-0.9324 strong bullish move.
Meanwhile, technical indicators on the daily chart maintained their bearish bias and have again started gaining negative traction on hourly charts, clearly pointing to the resumption of the recent sharp corrective slide from multi-year tops set on August 12.
However, any subsequent slide might continue to find some support near the 0.8800 round-figure mark (61.8% Fibo. level), which if broken decisively will further reinforce the bearish outlook and pave the way for a further near-term depreciating move.
Below the mentioned handle, the cross is likely to accelerate the fall towards the 0.8730-25 intermediate support before eventually breaking through the 0.8700 handle towards testing its next major support near the 0.8680-75 horizontal zone.
On the flip side, the 0.8900-0.8910 region might continue to act as an immediate strong resistance, which if cleared might trigger a near-term short-covering move towards the 0.8960-70 area en-route the key 0.9000 psychological mark (38.2% Fibo. level).

EUR/GBP daily chart