The EURGBP is joining in the downward play with the pair moving back below the broken trend line after the correction yesterday and early today, took the price back above this line (see daily chart below). The correction higher, however, did stay comfortably below the 100 day MA (blue line in the chart below) and the 38.2% retracement of the trend move lower from the years high to the years low (at 0.8037).
EURGBP moving lower with the Euro move lower.
The next target below are the lows for the year at the 0.78728-89 area. A move below that and the pair is trading at multi-year lows with other targets at 0.7810 and 0.7752.
Versus the GBP the EUR has not been as supported/strong as the GBP has had it’s run to the upside over the last year and this has obviously pushed the pair much lower. Much has been priced in. So there could be some good support on the first look at the year lows. Be aware. If it does break below, however, look for stops (risk defined and limited).
As for risk…looking at the hourly chart below, the 38.2-50% of the move down today comes in at 0.7934-525. The 100 and 200 hour MAs are in the area as well. Corrections higher should find sellers against this area now, if the sellers are to remain in control. A move above suggests the market is more balanced despite the ECB news.
The EURGBP should have resistance against the 38.2-50% and 100 and 200 hour MA now (blue and green line)