EUR/GBP PRICE ANALYSIS: CLEARS THE 20/50-DMA WITH BULLS EYEING 0.8900

EUR/GBP Price Analysis: Clears the 20/50-DMA with bulls eyeing 0.8900

The EUR/GBP path of least resistance is upward biased after clearing important technical levels.

The pair is testing a minor resistance trendline, which, once broken, would send the EUR/GBP toward 0.8900.

EUR/GBP Price Analysis: Upward biased and could test 0.8900.

The EUR/GBP climbs and cracks the 50 and 20-day Exponential Moving Averages (EMAs) on Monday as the Pound Sterling (GBP) weakens. Additionally, the EUR/GBP bulls are eyeing to break March’s monthly high of 0.8896 to test the 0.8900 figure. At the time of writing, the EUR/GBP is exchanging hands at 0.8880 after hitting a low of 0.8820.

EUR/GBP Price action

On Monday, the EUR/GBP 50 pip gain dragged the pair towards a one-month-old resistance trendline that passes around the 0.8860/80 range, which, if broken, would exacerbate a test of the 0.8900 mark. Nevertheless, March’s 1 high of 0.8896 would be the first resistance to be tested before claiming the former.

If the EUR/GBP breaks 0.8900, the next resistance would be the February 20 high of 0.8928. A breach of the latter and the 0.8950 would be next, followed by the YTD high of 0.8978.

The path of least resistance is upwards, as the Relative Strength Index (RSI) confirmed, with the RSI at bullish territory, aiming toward higher readings. Although near the neutral area, the Rate of Change (RoC) suggests that buyers are still in control.

As an alternate scenario, if the EUR/GBP drops below the 220-day EMA at 0.8840, that would pave the way to the 50-day EMA at 0.8816, ahead of 0.8800.