The newly emerging downtrend on the EURGBP was temporarily stopped today following the release of the latest inflation data in the UK. However, overall bearish bias continues to prevail.
The pullback may test the 38.2 per cent Fibonacci retracement level at 0.84060, but given that it is currently converging with the 50-day MA (in green) and 300-day MA (in purple), a breakout seems improbable. On the other hand, a reversal from there could be followed by a retest of the 23.6 per cent Fibonacci at 0.83599. That is if the price action manages to break the 100-day MA (in blue) and 200-day MA (in orange).
The major target for the new downtrend would be the last swing low at 0.83120, which has been tested several times already but has held on each occasion.
The pullback may test the 38.2 per cent Fibonacci retracement level at 0.84060, but given that it is currently converging with the 50-day MA (in green) and 300-day MA (in purple), a breakout seems improbable. On the other hand, a reversal from there could be followed by a retest of the 23.6 per cent Fibonacci at 0.83599. That is if the price action manages to break the 100-day MA (in blue) and 200-day MA (in orange).
The major target for the new downtrend would be the last swing low at 0.83120, which has been tested several times already but has held on each occasion.
