FX.co ★ EUR/GBP Potential For Reversal Up

EUR/GBP has rebounded from a strong support area and now is challenging a dynamic resistance. A breakout through 0.9100 and a new higher high could validate further growth.

The pair could jump higher after the German PPI data come in better than expected. EUR/GBP has been trading sideways, so we have to wait for a fresh trading opportunity before taking action.

• EUR/GBP Downside Seems Over!

EUR/GBP has found strong support on the 0.9025 level and now is pressuring the downtrend line. The pair has turned to the upside again after several false breakdowns below the median line (ML) of the major descending pitchfork.

Yesterday's bullish engulfing and the aggressive breakout above the Pivot Point (0.9064) suggest that EUR/GBP could develop an important upwards movement.

• EUR/GBP Trading Tips

Buy EUR/GBP after a bullish closure above the R1 (0.9121) level and use the R3 (0.9236) as an upside target. The upper median line (UML) could attract the price after the rejection from the median line (ML).

The bullish scenario could be invalidated if the pair stays under the downtrend line. If you want to see EUR/GBP, you should wait for a valid breakdown below the S1 (0.9007) level.