EUR/GBP Price Forecast: Short-term trend reverses on a dime, bulls back in charge

EUR/GBP is undergoing a short squeeze higher.
The upside will likely be capped at the cluster of Moving Averages situated in the 0.8450s.

Joaquin Monfort FXStreet

EUR/GBP has suddenly reversed and shot higher on Thursday, gaining over 1.0% on the day so far. The explosive rally suggests a short squeeze is happening, and the short-term trend has reversed “on a dime”. The bulls are now back in control.

EUR/GBP Daily Chart

EUR/GBP will probably go higher. The next key resistance level lies at the cluster of Moving Averages in the 0.8450s. From there, a temporary pullback is likely, given the speed of the ascent. Any corrections will likely encounter support at around 0.8385, the July lows.

One warning of the sudden reversal came from the fact that the Relative Strength Index (RSI) was converging bullishly with price (red dashed lines on the chart). This signified a lack of downside momentum and increased chances of a pullback.

Another warning sign was that EUR/GBP has already reached the conservative target for the bear move that began at the August 5 high, at 0.8322. This raised the possibility that the whole move might have completely run its course, which appears to be the case given today’s price action.

Author

Joaquin Monfort

FXStreet

Joaquin Monfort is a financial writer and analyst with over 10 years experience writing about financial markets and alt data. He holds a degree in Anthropology from London University and a Diploma in Technical analysis.

EUR/USD looks to stabilize near 1.1600 as focus shifts to US data

EUR/USD is looking to stabilize near 1.1600 in the European session on Wednesday as traders breathe a sigh of relief before the top-tier US ADP jobs and ISM Services PMI data. A pause in the US Dollar uptrend helps the pair's recovery, but surging energy prices due to the Iran war will likely remain a drag.

GBP/USD stays weak near 1.3350 as USD preserves gains

GBP/USD stays in the red below 1.3350 in the European session on Wednesday. Escalating conflict in the Middle East keeps the "flight to safety" theme intact, supporting the US Dollar against the Pound Sterling. Traders will take more cues from the US ADP Employment and ISM Services Purchasing Managers Index reports, which are due later on Wednesday.

Gold retains positive bias amid sustained safe-haven flows and modest USD pullback

Gold maintains its offered tone through the first half of the European session, though it lacks follow-through and remains below the $5,200 mark. Investors remain concerned about a prolonged conflict in the Middle East and its impact on the global economy amid an already uncertain environment.

ADP Employment Report set to signal stronger February jobs growth, little effect on Fed outlook

The Automatic Data Processing (ADP) Research Institute will release its monthly report on private-sector job creation for February on Wednesday. The so-called ADP Employment Change report is expected to show that the United States private sector added 50K new positions in the month, following the 22K gained in January.

Asian stocks fall as South Korea’s KOSPI slumps over 10%

Asian equities drop on Middle East tensions; the MSCI Asia Pacific Index falls up to 4%. South Korea’s KOSPI fell 10.71% near 5,170, with the Korean Won weakened past 1,500 per dollar.

Solana Price Forecast: SOL consolidation near resistance as ETF inflows offer mild support

Solana price is facing slight rejection as it approaches the upper boundary of the consolidation range at around $88 on Wednesday. Institutional demand is strengthening as spot Exchange Traded Funds recorded two consecutive inflows so far this week.