Bullish pattern spotted: EUR/GBP technical analysis
EUR/GBP technical analysis shows that a large bullish pattern has taken shape on the lower time frames. Watch out for breakout above the 0.8600 resistance level.
The EUR/GBP pair has recently started to fade from the 0.8600 level as the British pound stabilises against most major currencies.
However, key technical support is holding, hinting that buyers may be preparing to push the currency pair into a much higher price range over the medium-term.
Fundamental factors may come into play this week, with the upcoming ECB monetary policy meeting, EU PMI prints, and high-impacting UK news all on the economic docket this week.
EUR/GBP medium-term price trend
EUR/GBP technical analysis shows that the pair remains bearish over the medium-term while trading below the 0.8770 level.
The recent move towards the 0.8600 level shows that the EUR/GBP pair could still continue to press higher, as medium-term selling pressure is finally starting to subside.
Technical analysis on the daily time frame indicates that if buyers can rally the EUR/GBP pair above the 0.8600 level then a bullish breakout could occur.
The EUR/GBP pairs 50-day moving average is located around the 0.8520 level, and is currently acting as major support.
As long as bulls continue to defend the 50-day moving average, the EUR/GBP pair has a high probability of heading back towards 0.8600 and beyond.
Only sustained weakness below the 0.8490 level would cause medium-term bulls to consider exiting EUR/GBP long positions.
EUR/GBP short-term price trend
Traders should be aware that a breakout above the 0.8600 level could launch the EUR/GBP into a much higher price range.
The overall upside projection of the bullish reversal pattern is around 300 points and would take the EUR/GBP pair towards the 0.8900 level.
It is also noteworthy that short-term sellers are struggling to move the EUR/GBP below key support, which hints that bulls are getting stronger.
EUR/GBP technical summary
EUR/GBP technical analysis suggests that as long as bulls defend the 0.8490 level the pair has a strong chance of advancing higher over the medium-term.
This is very repetitive. I would alter the language here. It's like reading the long-term trends twice