EUR/GBP Daily Outlook

Daily Pivots: (S1) 0.8702; (P) 0.8727; (R1) 0.8769; More.

EUR/GBP's recovery from 0.8601 resumes and reaches as high as 0.8785 so far. While more rise could still be still, we'd continue to expect strong resistance at 0.8792 to limit the recovery and bring fall resumption. Below 0.8686 minor support will flip intraday bias back to the downside and break of 0.8601 low will bring fall resumption to 100% projection of 0.9410 to 0.8833 from 0.9153 at 0.8576 next. However, decisive break of 0.8792 resistance will be the first signal that recent decline from 0.9410 has completed and stronger rally should be seen to 0.8833/9153 resistance zone next.

In the bigger picture, current development indicates that rebound from 0.8399 has completed at 0.9410 already and fall from there could be the third leg of the whole correction pattern that started at 0.9799. Outlook will remain bearish as long as 0.8833 support turned resistance resistance holds. Correction from 0.9799 could extend further to 0.7693/0.8186 support zone, with 100% projection of 0.9799 to 0.8399 from 0.9410 at 0.8010 in between. On the upside, though, above 0.8833 will argue that fall from 0.9410 might be over and price actions from 0.9799 are developing into sideway consolidation, probably in form of triangle, rather than a deep correction.

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