EURGBP has been lacking direction over the last month as it hovers within a narrow range with upper boundary the 0.9085 resistance and lower boundary the 0.8930 support. It is noteworthy that the price created a strong spike to the upside during the previous week, recording a fresh 16-month high of 0.9110. Technically, the %K line of the stochastic oscillator is ready to turn to the upside creating a bullish cross with the %D line.
An upside run in the price and a successful leg above the 20-day simple moving average may retest the upper Bollinger Band of 0.9050. Above this level the pair could challenge the previous peak of the 0.9085 resistance. Also, investors would be interested to see whether bullish dynamics can overcome the previous peak and meet the 0.9110 strong obstacle.
Alternatively, a decline in the price may retest the 0.8930 support barrier, which stands near the 40-day SMA. More downside pressure could send the market until the 0.8810 key level.
Concluding, in the bigger view, EURGBP has been trading in a consolidation area over the last 16 months.
