EURGBP appears poised for further losses and slipped beneath the 0.8850 barrier, while euro was the worst performing major currency during yesterday’s trading session. The single currency had been under pressure versus sterling during the US trading session on Tuesday and ended the day near its low.
The price recorded the second straight bearish day and plummeted almost 1% following the bounce off the 0.8923 resistance level. Currently, in the short-term timeframe, the pair is developing between the 38.2% and the 50.0% Fibonacci retracement levels of the last significant upward movement with the low at 0.8690 and the high at 0.8923. The aforementioned levels are holding near the 0.8833 resistance level and the 0.8805 support level respectively.
In case of further losses, the price could drop until the 61.8% Fibonacci mark near 0.8780 or moreover towards 0.8760. An alternative scenario is an upward correction until the 0.8850 obstacle and the 23.6% Fibonacci level 0.8867, which is close to the 25-simple moving average in the 4-hour timeframe.
During the previous sessions, the two SMAs (14 and 25) posted a bearish crossover, indicating a continuation of the sell-off. However, the momentum indicators seem to be in confusion. The RSI indicator is sloping to the upside in the negative territory, signaling for a pause of the downward movement, but the MACD oscillator is still strengthening its negative momentum below the zero and trigger lines.
Having a brief look in the daily timeframe, EURGBP has been trading within a downward sloping channel since October 2017, endorsing the scenario for bearish behavior in the medium term.
