EURGBP upside points to possible bullish momentum

EURGBP upside points to possible bullish momentum


he EURGBP pair has been falling over the past week. However, with the boost seen from strong PMI figures out of the eurozone this morning, signs are pointing towards the possibility of the pair returning towards the higher end of the descending channel in play over the past six months.

The daily chart shows that the pair temporarily broke below the lower trendline yesterday, only to push back towards the upside today. Should the price close within the top half of yesterdays candle body, then this would represent a piercing pattern, which is a bullish reversal signal. Whilst not as strong as a bullish engulfing formation, it is certainly something which would catch the eye and highlight the possibility of a reversal back to the upside. Taking a look at the indicators, the stochastic and CCI both point towards an oversold market which is in the process of reversal. Furthermore, as it stands the MACD histogram appears to be moving closer to 0, which often precedes a bullish move in price action.