EUR/GBP weakness has accelerated sharply for a clear break of the 0.8966/46 uptrend from late April, as well as importantly the 200-day average at 0.8926 on a closing basis. Critical now is the 0.8866/64 key price pivot, below which the pair should, at last, confirm a major top has been established, per Credit Suisse.
“EUR/GBP weakness has accelerated sharply for not only a clear break of the uptrend from late April and recent low at 0.8966/46 but also and importantly and on a closing basis the 200-day average at 0.8926. This should further increase we are in the process of seeing a major bullish reversal for GBP with critical now the 0.8866/64 key price pivot.”
“Ultimately, we remain of the view the 0.8866/64 mark needs to be removed to suggest we have seen an important top complete to turn the core trend bearish. We would then see support initially at the 0.8671 low from late April, then the ‘neckline’ to the late 2019/early 2010 base at 0.8609, with the ‘measured top objective’ seen at 0.8436.”
“Resistance is seen at 0.8940/46 initially, then 0.8984, with the outlook seen staying bearish whilst below 0.9070.”