EUR/GBP has closed above key resistance at 0.8643/65 to complete a base and a close above 0.8574 today would also see a bullish “reversal week” established to reinforce the likelihood for a deeper recovery to 0.8732 initially, analysts at Credit Suisse brief.
The risk moves higher with resistance seen at 0.8732/38
“Whilst we would look to see a weekly close above key resistance at 0.8643/65 our bias is for this to be achieved to see a base established to reinforce a recovery theme. Additionally, a close above 0.8574 today would also see a bullish ‘reversal week’ established to further reinforce a recovery story. We would then look for a move to 0.8732 next, then the 38.2% retracement at 0.8761.”
“Big picture, we would not rule out a move back to the ‘neckline’ to the medium-term top at 0.8861.
“Support moves to 0.8659 initially, with a break below 0.8526/21 now needed to ease the immediate upside bias for a retreat back to 0.8578, but with fresh buyers expected here for now.”