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EUR/GBP Breakout Favored

EUR/GBP is still bullish on the Daily chart and looks motivated to take out a dynamic resistance. Price is going higher as the Euro has managed to increase versus its rivals, but we have to wait for a valid breakout to be sure that will resume the upside movement. Euro is bullish versus the Cable, even if the Euro-zone Industrial Production dropped by 0.6% in June, more versus the 0.4% estimate. The economic indicator plunged after the 1.3% growth in the former reading period.

We have a poor economic calendar today, the rate is driven by the technical factors, so a breakout above the third warning line (wl3) of the former descending pitchfork looks favored. I’ve said in the previous report that will climb much higher if will have enough energy to stabilize above the 50% Fibonacci line.

The next major upside target will be at the upper median line (UML) of the major ascending pitchfork, could also hit the 0.9226 static resistance. Price is trading in the green as the Cable is bloodless on the short term, GBP slips lower also versus the USD.

It is expected to approach and reach the 0.9226 major resistance because is moving in range, you can see that we have an extended sideways movement on the Daily chart.

Only a breakout above the 0.9226 swing high will confirm a medium and long term increase, but is premature to say what will happen because a rejection here will send the rate tumbling on the short term.

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