EUR/GBP plunged and resumed the yesterday’s bearish candle. The rate is pressuring an important support area, a valid breakdown will signal a further drop in the upcoming weeks. Remains to see what will really happen because this could be only a temporary drop because the rate wants to retest the broken dynamic resistance.

I’ve said in the previous report that breakout needs to be confirmed before we can be certain that the pair will move upwards in the upcoming period. Technically, it maintains a bullish perspective on the short term.

Price moves somehow sideways on the short term, so we’ll have a clear direction only after a valid breakout from this pattern.

The Euro decreased even if we had some good data from the Euro-zone, the Retail Sales have increased by 1.5% in November, beating the 1.4%, while the Sentix Investor Confidence increased from 31.1 to 32.9 points, beating the 31.5estimate. Unfortunately for the Euro, the German Factory Orders dropped by 0.4% in November, even if the traders have expected to see a 0.1% growth after the 0.7% growth in October.

On the other hand, the Halifax HPI dropped by 0.6%, even if the economists have predicted a 0.2% growth.

You can see on the Daily chart that the rate dropped significantly after the failure to reach and retest the 38.2% retracement level. Now it is pressuring the fourth warning line (wl4) of the minor ascending pitchfork. I’ve said that the rate could come back to retest the broken warning line (wl4) and the lower median line (LML) of the major ascending pitchfork before will climb much higher.

I want to remind you that only a valid breakdown below the LML will announce a larger drop, otherwise, the perspective remains bullish on the Daily chart. The failure to retest the LML will signal that the rate will move up very quickly in the upcoming days, so you can keep an eye on this pair because we may have a buying opportunity.