- EUR/GBP remains muted in the Asian session on Monday.
- More pain for the pair if price breaks 0.8550 multiple support level.
- Momentum oscillators divergence points to more downside momentum.
EUR/GBP trades mildly lower following the previous session’s declines. The pair hovers in a very narrow trade band with no meaningful traction. At the time of writing, EUR/GBP is trading at 0.8555, down 0.01% for the day.
EUR/GBP daily chart
On the daily chart, after testing the high of 0.8658 on Thursday, the EUR/GBP cross currency pair fell nearly 100 pips in a span of two days. Currently, to add to the downward trend, the price skid below the 21-day SMA at 0.8566.
If the pair breaks the 0.8550 level, then EUR/GBP bears will continue to move lower toward the 0.8535 horizontal support level. Furthermore, the divergence in Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) points to more correction in the price. In doing so, the next probable price action could be found at the low of September 16 at 0.8500, followed by the 0.8480 horizontal support level.
Alternatively, if price breaks the 21-day SMA, it could move back to the 0.8580 horizontal resistance level. Next, EUR/GBP bulls would aim for the psychological 0.8600 mark and move onto the 0.8620 horizontal resistance zone thereafter.
EUR/GBP additional levels