The EUR/GBP rallied aggressively and touched fresh new lows. Is very heavy on the Daily chart and seems unstoppable right now also because the United Kingdom inflation data have impressed earlier. The Cable has received a helping hand from the UK’s data, the pair is driven by the fundamental factors. Technically, it was expected to drop further on the short term, so the perspective remains bearish until the buyers appear again.

The EUR/GBP is focusing on correction right now, this is natural after the false breakout above a dynamic resistance. The Pound is boosted by the UK’s impressive data, the CPI rose by 2.9% in the previous month, beating the 2.8% estimate and versus the 2.6% in July, while the Core CPI surged by 2.7%, more versus the 2.5% estimate and compared to the 2.4% growth in the former reading period. The PPI Input surged by 1.6% in August, beating the 1.2% estimate, the RPI increased by 3.9%, exceeding the 3.7% estimate and the 3.6% growth in the former reading period. Moreover the HPI increased by 5.1% in July, beating the 4.8% estimate, while the PPI Output rose by 0.4%, beating the 0.1% estimate and the 0.1% in the former reporting period.

The currency pair drop like a rock on the short  term after the false breakout above the upper median line (UML) of the major ascending pitchfork. Is almost to reach the third warning line (WL3) of the descending pitchfork, where he could find temporary support.  Could be attracted by the confluence area formed by the median line (ML) of the major descending pitchfork with the warning line (wl3).

The price has dropped as much as 0.9002 level, failing to reach the 0.9000 psychological level. Will hit fresh new lows if will stabilize below the broken 0.9048 static support. I want to remind you that we’ll have a broader drop only if the rate will take out the support from the median line (ML) of the major ascending pitchfork. The perspective will remain bullish on the daily chart if the median line (ML) will hold.