EURGBP has been in an uptrend over the last couple of months. Today’s gain has led the pair to record a fresh seven-and-a-half-month high of 0.8879. In yesterday’s trading the pair finished the day 0.7% higher.
Looking at the Ichimoku analysis, the positive alignment when the Tenkan-sen line (red) crossed above the Kijun-sen (blue) in mid-May, is still in place. Moreover, the Tenkan-sen is currently steeply upward sloping, indicating that the positive short-term momentum remains intact. Adding to this conviction is the RSI indicator, which is well into bullish territory at 65 and maintains a positive slope.
The 0.89 handle, a potential psychological level, could act as a barrier to up movements in price. Further up, the near eight-month high of 0.8937 (excluding the November 9 spike), might offer additional resistance.
On the downside, the current level of the Tenkan-sen, which currently coincides with another potential psychological point, namely the 0.88 mark, could provide support. Below this point, the focus would shift to the Kijun-sen at 0.8741 as another support level.
As regards the medium-term outlook, the pair was ranging sideways for a significant part of the year. However, the uptrend in recent weeks, combined with the fact that the price is currently comfortably above both the 50- and 200-day moving averages, are painting a bullish picture.
To sum up, the short-term outlook is bullish. The same holds for the medium-term.
