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The EURGBP is following the EURUSD’s move lower today and in the process has shifted the bias back to the downside.
Recall from last week, the price low on March 28 was at 0.8321 but by the end of the day, had moved above the 100 hour MA, and the 200 hour MA.
That upside momentum was continued on Tuesday. The price high was reached on Thursday at 0.85118.
Since then a reversal lower has seen the price move back below the rising 100 hour MA on Thursday. The high on Friday retested that 100 hour MA before moving lower again today.
The price action today saw the price move below the 100 day MA at 0.8499 and the 200 hour MA near the same level. With the natural 0.8400 level at that level too, it now represents a risk level for shorts. The new low for the day was just reached at 0.83607.
The pair is still off the low from a week ago at 0.8321, but a good chunk of the move higher last week, has been retraced.
What next?
Watch the 61.8% at 0.8377 as close risk. A stronger resistance for sellers looking for more downside would come in at 0.8400 area. Seller would not want to see those levels breached on a corrective move higher.
On the downside, fall below 0.83588 and the door opens for 0.8338 and 0.8321 (last Monday’s low) ahead of the low from March 23 at 0.8295.