EURGBP bounced back today after finding support at 0.7540, just above the Kijun-sen line. RSI has ticked back upwards from around 50 after today’s gains, indicating a weak upside bias in the near term. However, the signal line in the MACD chart is sloping downwards, which could be a sign of a broader weakening of the current uptrend.
The present rally that started in December 2015 has shifted the medium-term outlook for the pair to bullish as prices have surged above the Ichimoku cloud and the 200-day moving average. A push above the January 20 high of 0.7755 is needed to sustain this bullish bias.
If prices dropped back below 0.7540, this could open the way for a decline towards 0.7350, which is a previous key resistance level. A break below this level would put EURGBP back in the sideways range it was trading in for most of 2015.
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