The EUR/GBP has dropped in the second part of the day and has erased the morning gains, maybe will be better to stay away from this pair in the upcoming period because the rate continues to move sideways on the daily chart. Right now we don’t have a good trading opportunity, but I hope that we’ll have a clear direction very soon because the rate can’t continue to move sideways too much.

Price has touched a major dynamic resistance, a failure to close above or on this line will send the pair much lower in the upcoming days. The EUR/GBP has decreased  and could try to close the yesterday’s minor gap up, could drop much deeper if will close this gap.

The pair has dropped as the Euro has become bearish in the second part of the day, has depreciated also versus the greenback, Yen  and versus the CHF, not only the Pound. The European currency has fallen on the mixed Euro-zone data, while the Cable has increased after the UK’s data was released, even if the numbers have failed to impress, actually the figures have disappointed.

Price has dropped after the retest of the median line (ML) of the major ascending pitchfork, the rate has climbed above the major dynamic resistance, but has failed to stay there. The rebound was expected after the failure to retest the 76.4% retracement level and the lower median line (LML) of the ascending pitchfork, but the failure to break and stabilize above the median line (ML) will attract the sellers again.

Price will drop sharply if will fail to close on the median line, the major downside target will be at the lower median line (LML) of the major ascending pitchfork. We’ll have a clear direction only if the rate will escape from the sideways movement between the 76.4%  and the 100% Fibonacci levels, a larger drop will come only if the rate will breakdown from the ascending pitchfork’s body.

A buying opportunity will come if the rate will jump and stabilize above the median line (ML) again, will take out the resistance from the 100% level if will stabilize above the ML.