The EUR/GBP has managed to climb higher and now is very close to touch a potential resistance level, we’ll see how will react when will hit this level, personally I believe that will ignore the minor resistance level and will continue to increase because the Euro looks determined to recover versus all its rivals, not only versus the Cable. The Euro has increased today also versus the greenback and against the Japanese Yen. The currency pair may increase further after the failure to take out some important support levels.

The pair has increased amidst good Euro-zone data, the Italian Retail Sales have increased by 1.2%, more versus the 0.4% estimate, the sales have increased again after a 3-month decrease, so the indicator has lifted the European currency a little. Moreover the German Import Prices rose by 0.7% in November, beating the 0.2% forecast. On the other hand, the United Kingdom Gfk Consumer Confidence has increased a little from -8 to -7, has come better than the -8 estimate, but the data have failed to save the pound from the downside.

The price has increased after the failure to break below the 76.4% retracement level and below the median line (ML) of the ascending pitchfork, the behavior has changed on the short term, the rate has started to make higher lows, signalling an oversold. The rate is very close to hit the minor dynamic resistance level from the upper median line (uml) of the descending pitchfork, we’ll see if this level will have enough power to stop the bullish momentum.

I’ve said in my previous analysis that the perspective remains bullish as long as the price will stay above the median line (ML) and above the 76.4% retracement level, now could climb again towards the upper median line (UML) of the ascending pitchfork, could also approach the 100.0% Fibonacci level.

Resiatance can be found also at the 50% Fibonacci line (ascending dotted line), but my feeling is that will increase further on the short term as the Cable is under selling pressure again.