The price action of the EURGBP is currently probing a major support-turned-resistance level at 0.84250. A reversal from this threshold would likely indicate the continuation of the broader downtrend, which was initiated following a breakdown below the Pennant. The strength of the downtrend is underpinned by the ADX indicator, which is threading above its 25-point benchmark.
However, a a breakout above it could be followed by a test of the 23.6 per cent Fibonacci retracement level at 0.84470. The latter is about to be crossed by the 50-day MA (in green), making it an even more prominent resistance.
Should the price action manage to break higher, its next challenge would be the 38.2 per cent Fibonacci at 0.84876, which is currently converging with the 100-day MA (in blue).
However, a a breakout above it could be followed by a test of the 23.6 per cent Fibonacci retracement level at 0.84470. The latter is about to be crossed by the 50-day MA (in green), making it an even more prominent resistance.
Should the price action manage to break higher, its next challenge would be the 38.2 per cent Fibonacci at 0.84876, which is currently converging with the 100-day MA (in blue).
