Today, we will consider one of the most interesting and important cross-rates: the euro/pound. As it has been repeatedly mentioned earlier, the dynamics of this pair often have a tangible impact on the main currency pairs euro/dollar and pound/dollar. Let's take a closer look at the technical picture observed for this trading instrument and start with a review of the weekly timeframe.
Weekly
As can be seen on the weekly chart, after the decline to the level of 0.8450, the pair found strong support here and began to show signs of recovery. In general, the range in which this instrument is traded can be designated as 0.8450-0.8720. It is noteworthy that the quote has been in the designated range since April of this year. Hence, it can be assumed that only a true exit from the current range will indicate the medium-term and maybe even long-term prospects for the price movement of EUR/GBP. Immediately it is worth noting that the path up is blocked by the red Tenkan line and the blue Kijun line of the Ichimoku indicator. If the current week closes above the Kijun (0.8583), it will become very likely that the pair will grow to the used moving averages, the nearest of which, 50 MA, is at the level of 0.8695. Given the strong technical level of 0.8700, we will designate the resistance zone on the weekly chart as 0.8695-0.8720. If the market chooses a bearish scenario and breaks through the support level of 0.8450, there will be prospects for a subsequent decline, up to 0.8280.
Daily
On the daily chart, euro/pound bulls are struggling to move up with the black 89 exponential moving average, which does not want to give in and skip the pair higher yet. The same can be said about the Ichimoku indicator cloud, in which players most likely do not have enough strength or the necessary strong driver to go up. Strong support for the pair is provided by 50 MA and the level of 0.8541. In general, the daily range in which the euro/pound is traded can be designated as 0.8541-0.8592. For purchases, I suggest waiting for the breakdown of the resistance of 0.8592 and the level of 0.8600, after which we try to open long positions on the rollback. To open sales, you will have to wait not only for the breakdown of the support level of 0.8541 but also for the psychological mark of 0.8500. I believe that only after that, on a rollback to the area of 0.8500-0.8540, we can consider selling EUR/GBP. If I express my personal opinion, I will give more preference to the ascending scenario. However, all this should be confirmed by appropriate technical signals. So I think it's not worth rushing yet.
