EUR/GBP has been impulsive with retracements recently inside the tight corrective structure above the support area of 0.8750. Due to recent positive economic reports on the GBP side, EUR has been struggling to keep up with the mixed economic reports to push the price higher. Today, the UK RICS House Price Balance report was published with a significant increase to 8% in value from the previous value of 0% which was expected to be negative at -1%. The positive economic report provided GBP with the required pressure to sustain the recent gain against EUR that is expected to continue further. On the EUR side, today German Buba President Weidmann spoke about the interest rates and monetary policies. His speech was quite neutral in nature and was not enough to support the EUR gains against GBP. As for the current scenario, GBP has turned the table suddenly inside the volatile and corrective structure. GBP is expected to dominate further in the coming days until the eurozone provides better than expected economic reports or events, signalling further notable economic recovery in the long term.
Now let us look at the technical chart. The price is currently residing below the dynamic level of 20 EMA after a recently bounce off the trend line resistance at 0.89 area. The price action squeeze is currently signaling a bearish pressure which is more probable to break below it in the coming days to head much lower below the 0.8750 area with a target towards 0.8550. As the price remains below 0.8900, which is the trend line resistance, the bearish pressure is expected to continue further.
