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EUR/GBP Falls to Fresh 2014 Lows

Last week traders faded EUR, and EUR/GBP broke below a consolidation range that was roughly between 0.8190 and 0.8258. This was on the back of a dovish ECB press conference. 


(eurgbp 4h chart, 5/12)

Here are a couple of observations in the 4H chart:
1) Alignment of moving averages and position of price versus moving averages reflect a very bearish market.
2) The RSI has been holding below 60 and falling below 30, a sign of persistent bearish momentum.


Traders started the week extending EUR-weakness, and EUR/GBP fell the previous 2014-low of 0.8157, made in February. 


(eurgbp daily chart, 5/12)

Here are a couple of observations from the daily chart:
1) Bearish based on alignment of moving averages and position of price relative to moving averages.
2) The RSI reflects a market that looked to turn from bearish to neutral but failed. The rally from 0.8157 to 0.84 earlier in the year looked promising, but it ultimately retreated after tagging the 200-day SMA as resistance.

Support pivot/oversold:
The EUR/GBP thus remains bearish with the new low on the year. The next support pivot is in the 0.8080-0.81 area. With the oscillators in the oversold area, look for a bullish attempt if the market stabilizes above this 0.8080-0.81 area.

Resistance:
In the case of a pullback, the 0.8190-0.82 area could turn from being a previous support to resistance. At least a bearish market should be looking at this area for resistance. A break above 0.8260 will be needed to show a shift away from the bearish market to a neutral or bullish one.