- EUR/GBP meets with some fresh supply on Monday and slipped back closer to one-month lows.
- The technical set-up seems tilted in favour of bears and support prospects for a further decline.
The EUR/GBP cross edged lower on the first day of a new trading week and remained well within the striking distance of one-month lows set last Thursday.
The cross has been oscillating in a range around the 0.8750 confluence region, comprising of 61.8% Fibonacci level of 0.8282-0.9500 upsurge and 200-day SMA.
The pair’s inability to register any meaningful recovery and the recent range-bound action suggests that the near-term bearish pressure might still be far from being over.
Meanwhile, technical indicators on hourly/daily charts maintained their bearish bias, which reinforces the negative outlook and support prospects for a further depreciating move.
The cross seems all set to resume its rejection slide from the key 0.9500 psychological mark, or multi-year tops set on March 19 and aim towards the 0.8700 round-figure mark.
The downward trajectory could further get extended towards mid-0.8600s before bears eventually aim towards challenging the next major support near the 0.8620 region.
On the flip side, any attempted recovery move might continue to confront some fresh supply near the 0.8800 mark and remain capped near the 0.8820 horizontal resistance.
That said, a sustained strength might prompt some near-term short-covering move and lift the cross back towards 50% Fibo. level, around the 0.8900 round-figure mark.
EUR/GBP daily chart
Technical levels to watch