EUR/GBP drops back to 0.7870 confluence support

By FXStreet The EUR/GBP pair remains intact within a broad trading range but is now heading towards session low level of 0.7870, the lower end of the range.

The pair has been oscillating within a broad trading range with 50-day SMA (near 0.7870-65 region) acting as lower end support and 0.7925 level as the upper end of the trading range resistance. In the past few days, every attempt to clear 0.7925 has gotten sold into and the pair had dropped back to the 50-day SMA support, defining a broad trading range for the pair.

The lower end of the trading range also coincides with 20-day SMA and hence a decisive break-down below this important confluence support might open room for deeper slide in the near-term.

Technical levels to watch

Below 0.7870-65 confluence support, the pair could immediate drop to 0.7850 support level, which if broken might continue dragging the pair back towards 0.7780 support area.

Conversely, bounce of current support area might now face immediate resistance near 0.7900 round figure mark. Any up-move beyond 0.7900 handle might continue to face strong resistance near 0.7925 region. Only a convincing break through the 0.7925 strong resistance would negate any further bearish bias and assist the pair towards …read more

Source:: FX Street