EUR/GBP staged a deep pullback to 0.8609 last week but rebounded just ahead of 38.2% retracement of 0.8354 to 0.8752 at 0.8600. Initial bias is turn neutral this week first. Corrective pattern from from 0.8752 could still extend. But in case of another fall, downside should be contained by 0.8600. Firm break of 0.8752 will resume the rise from 0.8354 towards 0.8867 fibonacci level.
In the bigger picture, the structure from 0.8221 medium term bottom are not impulsive enough to suggest that it’s reversing the down trend from 0.9267 (2022 high). But even if it’s a correction, further rise is expected to 61.8% retracement of 0.9267 to 0.8221 at 0.8867. This will remain the favored case as long as 55 W EMA (now at 0.8485) holds.
In the long term picture, price action from 0.9499 (2020 high) is seen as part of the long term range pattern from 0.9799 (2008 high). Range trading should continue between 0.8201 and 0.9499, until there is clear signal of imminent breakout.
