The EUR/GBP was bearish for the most part in May, falling from 0.7483 to 0.7055. After a rebound from 0.7055, it looks poised to test the 0.7283 resistance.
After a bullish engulfing pattern in the 4H chart, EUR/GBP has not looked back. It broke a falling trendline and is now above the 50-, and 100-period simple moving averages. The 4H RSI also tagged 70, which represents initiation of bullish momentum.
The RSI is overbought, and there is a support/resistance pivot, where we might get some pullback. Now, if this short-term bullish outlook is to materialize, we should see support in the 0.7122-0.7137 area. A break below 0.7120 might represent a bearish continuation scenario.
Now, the projected rally to 0.7283 would be within the context of a neutral-bearish market in the medium-term. But a break above 0.7285 would open up a neutral-bullish one, with the 0.7483 level in sight.
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