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Short term support slide, multi-week low


EUR / GBP price, news and analysis:

  • Negative technical configuration.
  • The sentiment of IG customers also suggests lower prices.

EUR / GBP competes with a group of resistance levels and looks likely to decline if these hold up. The pair is trading on either side of trend resistance and apex of trend support, and a close below that support, and preferably the 38.2% Fibonacci retracement level at 0.9035, may usher in a period of falling prices.

The 20-day simple moving average has moved below the 50-day sma, a bearish sentiment setup, and these two moving averages – 20 dma at 0.9072 and 50 dma at 0.9087 – will also act in the short term. resistance. The longer term 200-dma is currently closed at 0.8951 and a breakout and close below will also add to the bearish outlook for the market. Below, the 50% Fib retracement at 0.8891 and the September 3 multi-week low at 0.8865 will likely be targeted.

Any bullish reaction should encounter resistance between 0.9148 and 0.9165.

Fundamentally, news of the EU / UK trade talks is likely to be the driving force behind the pair. EUR/GBP is a good barometer of how the talks are progressing and any suggestion that a deal is in the works will bring the pair down. On the other hand, if the EU / UK trade talks fail, the pair will quickly push against the resistance levels mentioned above.

EUR forecast

EUR forecast

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EUR / GBP Daily Price Chart (February – October 28, 2020)

EUR / GBP - Short term support slide, multi week low



of customers are net long.



of customers are net short.

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Long

Shorts

OI

Daily 15% -8% 3%
Weekly 15% -19% -4%

IG Retail trader The data show 54.44% of traders are net long with a long to ask ratio of 1.19 to 1. We generally take a vexing view of crowd sentiment, and the fact that traders are net long suggests EUR/GBP prices may continue to fall. And Traders are longer than yesterday and last week, and the combination of current sentiment and recent changes gives us a Stronger EUR / GBP – bearish countercurrent trading bias.

What is your opinion on EUR / GBP – bullish or bearish ?? You can let us know via the form at the end of this article or you can contact the author via Twitter @ nickcawley1.



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