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The bullish trend continues for EUR/GBP

EUR/GBP Bounces Off the 20 SMA, After a Bullish Chart Setup

Posted Tuesday, June 23, 2020 by
Skerdian Meta • 1 min read

EUR/GBP made a strong bullish move in late February/early March, climbing 12 cents higher, and then retreated 8 cents lower during most of march. In April and in the first week of May, this pair consolidated in a 200 pip range, but broke out of it by the middle of last month and since then buyers have been in control.

This forex pair moved above the big round 0.90 level in the last days of May, reaching 0.9050s, but pulled back down again. For a few weeks we saw another range-bound trading in EUR/GBP. But, the Euro has ben more bullish than the GBP, with Europe coming out of the lockdown.

So, the range was broken at the end of last week, which was another bullish signal. Yesterday though, we saw this pair pullback lower. But the decline was quite slow, which suggested that buyers were going to jump in again soon. They did so after the price formed a doji candlestick above the 20 SMA (grey) on the H4 chart, which is a bullish reversing signal.

The 20 SMA also provided solid support, so EUR/GBP bounced off the 20 SMA and is now 50 pips higher. We missed that opportunity yesterday to buy the pair at the 20 SMA, but will do so when another pullback takes place.

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