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EUR/GBP Price Forecast: Breaks below 0.8550; 14-day EMA appears as a next support.

August 13, 2024

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EUR/GBP broke below the nine-day EMA at 0.8539 level, suggesting a short-term bearish trend.
The momentum indicator 14-day RSI still suggests a bullish bias for the currency cross.
The 14-day EMA at 0.8520 level could act as immediate support.

EUR/GBP retraces its recent gains from the previous session, trading around 0.8530 during the European hours on Tuesday. The daily chart analysis shows the EUR/GBP cross has broken below the nine-day Exponential Moving Average (EMA) at 0.8539 level, signaling the onset of a bearish trend in the short term.

However, the momentum indicator 14-day Relative Strength Index (RSI) remains above the 50 level, suggesting a bullish bias for the EUR/GBP cross. Further depreciation toward the 50 level would suggest the easing of bullish momentum.

In terms of resistance, the EUR/GBP cross could find an immediate barrier at a three-month high of 0.8624 level marked on August 8, followed by a seven-month high of 0.8644 level recorded on April 23. A break above the latter could strengthen the currency cross to explore the region around the psychological level of 0.8700.

On the downside, the immediate support appears at the 14-day EMA at 0.8520 level, followed by the EUR/GBP cross to test the 50-day EMA at 0.8487 level. A break below this support could suggest a confirmation of a bearish trend, potentially driving the cross toward a throwback support level at 0.8383.