EUR/GBP Mid-Day Outlook

Daily Pivots: (S1) 0.8951; (P) 0.8962; (R1) 0.8971; More…

EUR/GBP’s rise resumed by taking out 0.8992. Intraday bias is turned back to the upside for 0.9101 key resistance. Considering bearish divergence condition in 4 hour MACD, we’d look for topping signal as it approaches 0.9101 key resistance. On the downside, break of 0.8920 support will indicate short term topping. In this case, deeper pull back could be seen to 55 day EMA (now at 0.8844) first.

In the bigger picture, medium term decline from 0.9305 (2017 high) is seen as a corrective move. No change in this view. Current development argues that it might have completed with three waves down to 0.8472, just ahead of 38.2% retracement of 0.6935 (2015 low) to 0.9306 at 0.8400, after hitting 55 month EMA (now at 0.8527). Decisive break of 0.9101 resistance will confirm this bullish case. Nevertheless, as EUR/GBP is still staying inside long term falling channel, correction from 0.9305 could still extend to 0.8400 fibonacci level before completion, if upside is rejected by 0.9101.

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