EUR/GBP long-term technical analysis
The situation seems worse for Europe rather than the UK. Euro mostly under pressure against Pound sterling and other major currencies. Fundamentally, the Brexit may cause a ripple and cause Eurozone break. Even though Brexit has happened, there is no trade deal set yet. Both UK and Eurozone will discuss the deal and attempt to eke a deal in 12 months time-frame.
EUR/GBP might have mixed movement and continue under pressure while the trade deal negotiation takes place.
EUR/GBP has been on the bearish trend for sixth month. There is no end to the bearish pressure yet and the pair fall below 0.8400. Without any bullish close on the monthly chart, it is better to avoid long positions for now. If the pair continue lower then 0.8100 and 0.8000 will become the downward target.
Last week, the pair fell with strong bearish momentum and closed below 0.8325. It is the first close below the support level and might lead to further bearish movement. Without any close above the level, it is better to avoid long positions. 0.8400 is the level to look for short positions when there is a bearish reaction.
The lower low on the daily chart in the previous analysis is the confirmation that EUR/GBP trend has changed from bullish to bearish. The pair fell from 0.8900 to 0.8325 and showing no bullish sign yet. Currently, traders will continue to monitor the pair reaction at 0.8325 to determine the next direction.
Long strategy: No suggestion yet, traders will need to wait until bullish candlestick printed on the monthly chart. Short-term positions might be possible near 0.8325 or 0.8000 – 0.8100 area.
Short strategy: If a bullish correction happens toward 08400 then traders could start looking for short positions. Another option, traders could take a short-term position near 0.8325.