EUR/GBP Technical Analysis: Best Gain Since 2016, Downtrend Holds

EUR/GBP Technical Analysis

  • EUR/GBP had its best upside gain in a single day since the Brexit Referendum in 2016
  • New descending resistance from August keeps the dominant downtrend intact for now
  • Confirming new uptrend needs EUR/GBP to close above the October high at 0.89394

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Following a bullish reversal warning sign pointed out last week, EUR/GBP clocked in its best single day performance since June 2016. Fundamentally, weakness in the British Pound was as a consequence of the sudden increased probability that the UK could be heading for a ‘hard Brexit’. Significant and volatile moves in FX do open the door for new setups in technical analysis to see where prices may go next.

For EUR/GBP, multiple resistance barriers were knocked out within a span of 24 hours. But on the daily chart, we do have the formation of what appears to be a new descending trend line dating back to August. For the time being, this may keep the dominant downtrend

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