- EUR/GBP renews multi-year low during four-week losing streak.
- Descending trend line from mid-October, RSI conditions test further downside.
- Bulls remain away below monthly resistance line, DMA confluence guards short-term rebound.
EUR/GBP drops to the fresh low since July 2016 while taking offers near 0.8262 heading into Friday’s European session. In doing so, the quote drop for the fourth consecutive day, also for the fourth week in a row.
The cross-currency pair’s latest declines, however, has a limited downside as nearly oversold RSI conditions hint at a U-turn from a five-month-old support line, near 0.8250.
Should the extend the south-run below 0.8250, late June 2016 low near 0.8205 and 0.8190 may entertain bears before directing EUR/GBP bears towards April 2016 top of 0.8117.
Alternatively, a convergence of the 21-DMA and 50-DMA, near 0.8365, will challenge the quote’s short-term rebound, with the 0.8300 threshold likely acting as immediate resistance.
It’s worth noting, however, that EUR/GBP buyers remain skeptical until the pair crosses a downward sloping trend line from early February, near 0.8380.
Overall, EUR/GBP bears keep reins but further downside seems limited.
EUR/GBP: Daily chart
Trend: Further weakness expected
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