EUR/GBP Forecast Today 27/8: Stabilizes At Lows (Chart)
Date
8/27/2024 5:02:04 AM
(MENAFN- Daily Forex)
During the trading session on Monday, in my daily analysis of the EUR/GBP pair, the first thing that I notice is that this asset has been oversold over the last couple of weeks, after being overbought before that. We are starting to see a lot of support at this point, seemingly focused on the 0.8450 level. This is an area that has been somewhat important in the past, but at this point I think what we are simply seeing is short sellers step away from the markets, and therefore I think we got a situation where they are taking profit.
At this point, we could see the market try to turn around and break toward the 50-Day EMA, perhaps even the 0.85 level. If we can break above that level, then the market could go much higher, perhaps trying to reach the 200-Day EMA, followed by the 0.86 level. All things being equal, this is a market that I think bounces given enough time, but we also have to keep in mind that this is a nightmarish kind of pair to trade at times, due to the fact that it simply doesn't move very cleanly most of the time Extreme Lows
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When you look at this EUR/GBP pair, as it extreme lows, and it's worth paying close attention to the 0.84 level, which is a large, round, psychologically significant figure, and an area where we have seen the market behave supported previously. In fact, when you look at the monthly chart, you can see that this is an area that is going to continue to be a major problem for those who wish to short this pair. Because of this, I think it's probably only a matter of time before we see a turnaround, and a significant bounce. That being said, it doesn't necessarily mean that it's going to be easy, and I think you also have to keep in mind that the pair does tend to be choppy as the economies are so intertwined, despite the fact that we recently had Brexit, which if I remember correctly was going to be the end of the world. Obviously, that has not been the case, and trade still happens between the United Kingdom and the European Union, and quite a bit of it.
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