Technical Analysis of EUR/GBP
The Euro has been recently showing some strength against its major counterparts supported by the agreement on the second Greek bailout package and the general optimism that the danger of a contagion within the euro region has now been averted. The EUR/GBP has been trading in a downward channel from end October until mid- February, when risk appetite gave a boost to the euro and the BoE announced further quantitative easing. The EUR/GBP broke key resistance by 0.8396 on Wednesday 22nd and is currently trading at 0.8471, crossing over the 89 SMA for the first time in several months. With a bullish line capping RSI since December and the MACD flipping over zero it looks like the bulls have taken full control of the market. Further confirmation comes from the cross of the 20EMA over the 50 EMA on the hourly chart, favouring long positions with target at 0. 8524,the 50% Fibonacci level from October’s high to January’s low. In the alternative scenario, a downside movement below previous resistance by 0.8396 could open the door for the 0.8300 area.
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