EURGBP dips to pivotal 0.88 support after fresh weakness broke a cluster of supports
The cross came under renewed pressure at the beginning of American trading and probes through European session low at 0.8810, posted after strong bearish acceleration on media comments which improved Brexit outlook and boosted pound.
Fresh weakness surged through thin daily cloud (0.8851/38) and took out daily MA’s between 0.8830 and 0.8820 (55/30/20SMA’s) in extension, also triggering a number of stops parked in this zone.
Fresh bullish sentiment signals further recovery of sterling, which could extend higher against the Euro on sustained break below 0.8800 zone (psychological support / weekly cloud base / weekly Tenkan-sen).
Bearish scenario would open way for further retracement of 0.8686/0.8919 (25Jan / 14 Feb upleg) and expose its Fibo 61.8% at 0.8775, with break here to open 0.8732 (08 Feb spike low and key s/t support at 0.8686 (25 Jan low).
Alternatively, failure to close below a cluster of MA’s (0.8820/30) would ease immediate bearish pressure, however, return above broken 200SMA (0.8873) which capped the action in past three days, is needed to reverse current bearish bias.
Res: 0.8830; 0.8860; 0.8873; 0.8888
Sup: 0.8800; 0.8775; 0.8732; 0.8716