EUR/GBP Breaks Above the Triangle, As the 50 SMA Turns Into Support

EUR/GBP has been bullish since the middle of February, when it surged more than 12 cents due to the coronavirus panic, which sent the GBP diving nearly 20 cents lower.  We have sen some pullbacks lower since then, but the overall trend remains bullish.

The latest pullback lower happened during the last month, with EUR/GBP retracing nearly 300 pips lower, from below 0.93 to above 0.90. The 50 SMA (yellow) and especially the 100 SMA (green) turned into resistance for this pair and a descending trend-line formed at the top, connecting the highs.

At the bottom, this pair formed a support zone above 0.90, so a triangle was forming in EUR/GBP , during the latest retrace down. yesterday sellers tried the down-side, but failed once again and the price bounced from there. Today, the top of the triangle has been broken, together with the moving average, as the GBP turned bearish after pessimistic comments from BOE’s Vlieghe. The pullback sesms to have ended now and buyers are back in control. So, we will try to buy this pair on a pullback down to the moving averages, which is the top of the triangle as well.