EURGBP has been under pressure since topping out in early June, with a descending trend line capping every attempt at a bounce along the way down.

Price recently found a floor near the 0.8457 area before staging a corrective climb, and the pair is now testing the trend line and the 38.2% Fibonacci level around 0.8547, near current price at 0.8545.

The Fibonacci retracement tool, mapped from the June high to the recent swing low, shows this 38.2% mark as the first hurdle for the correction. Should buyers push through, the 50% level at 0.8575 or the 61.8% level at 0.8603 could come into play, though these remain well below the broader descending trend line drawn from the June peak, keeping the longer-term structure tilted to the downside.

Both moving averages continue to point lower, with the shorter-term average still below the longer-term one, confirming that sellers remain in control of the bigger picture even as price attempts to claw back some lost ground. A rejection from the trend line or the Fib cluster overhead would fit with the idea that the recent bounce is merely a corrective pause within the larger downtrend.

Stochastic has climbed sharply out of oversold territory and is now pushing toward overbought levels, reflecting the strength of the recent bounce, but this also raises the odds of exhaustion setting in soon if momentum can’t be sustained.

RSI has likewise turned higher and is back above the midline, showing the recent recovery in buying pressure, though it still has room to climb before reaching overbought territory.

The ECB kept rates on hold as expected in their monetary policy decision this week, with Lagarde reiterating their data-dependent view amid resurfacing Middle East tensions that could prop energy costs higher again. Lagarde emphasized that every meeting is a live one and that they remain open to policy options.