Recalling our previous forecast on EUR/GBP, the pair traded precisely in line with our analysis. Euro is firmly growing versus the British pound. Last week, the EUR/GBP produced a “bullish engulfing” pattern as it bounced almost from 2019 lows.
On Wednesday, the pair closed above 100-day MA and 38.2% Fibo retracement of this year’s drop.
The single currency euro is bullish on the news that the US would suspend its decision regarding inflicting tariffs on EU cars, while a continued impasse pressures the pound in Brexit talks between the UK’s major political parties.
It appears that EUR/GBP has undoubtedly broken out of the range within which it was trading in March and April.
Support and Resistance
R3: 0.8754
R2: 0.8746
R1: 0.8742
Key Trading Level: 0.8738
S1: 0.8734
S2: 0.8729
S3: 0.8721
On the lower side, immediate support will now be in the 0.8710/0.8690 area, whereas the bullish bias indicates an advance to 0.8785 (50% Fibo and the 200-day MA nearby). In the nonexistence of overly negative headlines from the euro area, an increase to 0.8860 (61.8% Fibo) will also be feasible. All the best!
