Lets recap last couple of weeks and look at EURGBP’s future ahead.
When we first looked at EURGBP it had just broken out of upper Trendline. Price then came back down to re-test the Trendline. When it failed to close below and bounced from that point it was clear that uptrend is in place and price will move up. Since then price has moved steadily upwards.
After EURGBP Technical Analysis recap a week later we noticed that price broke above the Resistance and we predicted that it may come down to test this Resistance which is now Support before heading up. As it turns out, price did exactly that. It is now up 100 pips since the test of the Support area.
So what’s next. EURGBP is facing minor Resistance 0.8800 but the Price Action suggest that it can easily reach 0.8930 in coming weeks.
Rise in EURGBP is mainly attributed to how Pound performance in recent weeks. Two main news items made GBP weaker, first was the poor numbers from UK Retails sales and second much bigger impact came from Bank of England’s decision to hold Interest Rates.
EUR on the other hand can gain strength if European Central Bank raise Interest Rate on April 7th.
Best way to go about trading this pair now is to look at shorter timeframe such as Daily and 4 hour and look for Resistance and Trendline breaks to the upside and then enter longs on the re-test.