EUR/GBP registered an amazing rally today and touched a medium term horizontal resistance. Is strongly bullish as the Cable remains sluggish on the short term. Is almost to hit a major dynamic resistance as well, remains to see how will react in the upcoming days because a valid breakdown will confirm a further increase on the medium term.

The Euro increased significantly on the mixed Euro-zone data, technically is somehow expected to climb much higher as we don’t have any weaknesses signal. The Cable goes down versus the other major currencies and could be saved from the downside only by the United Kingdom data.  The UK is to release the Second Estimate GDP, which should increase by 0.3%, matching the 0.3% growth in the former reading period. Moreover the Prelim Business Investment will be released as well.

The Euro rallied today, despite some poor Euro-zone data, the Consumer Confidence remains steady at   -2 points for the second month in July, matching expectations, while the Flash Services PMI decreased from 55.4 to 54.9 points, even if the estimate was 55.4 points. Moreover the French Flash Services PMI decreased from 56.0 points to 55.5 points, failing to reach the 55.9 estimate.

You can see on the Daily chart that the rate has touched the 0.9226 major static resistance and is almost to reach and retest the upper median line (UML) of the major ascending pitchfork. A breakout seems imminent as the rate is strongly bullish, but we need a confirmation that will resume the upside movement. I’ve said in the previous weeks that the rate will be attracted by the upper median line, which acts as a magnet. Was almost to reach the confluence area formed by the UML with the 0.9226 level. Resistance can be found at the fourth warning line (wl4) as well, but is premature to talk about this dynamic resistance as long as is trading under other major upside obstacles. Only a rejection from the mentioned resistance levels will signal a minor decrease on the short term.