EUR/GBP is back inside a multi-month range after briefly breaking out to the upside. The pair could potentially continue falling towards the range lows, with support from the 50 and 100 Moving Averages along the way. The sideways trend of the pair is expected to extend further.
On May 7, EUR/GBP fell back inside its multi-month range after a temporary upside breakout. This move continues the sideways trend of the pair, which is likely to persist as per the saying “the trend is your friend.”
EUR/GBP has decisively broken back inside its medium-term range, with a chance of falling towards support at around 0.8540. The convergence of the 50-day and 100-day Simple Moving Averages at 0.8566 may act as a barrier to further downside. The MACD indicator is also indicating bearish momentum, suggesting a potential continuation of the descent within the range/channel.
To change the sideways trend, EUR/GBP would need to break decisively below the range lows or above the April 23 high. A break below the range lows could target 0.8486 and further down to 0.8460. On the other hand, a break above the range highs and the April 23 peak at 0.8644 would indicate a new uptrend, with resistance at 0.8620.
In summary, EUR/GBP is back inside its range with potential for further downside movement, supported by key Moving Averages. Confirmation of a new trend would require significant price movements beyond the current range boundaries.