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26/11/24
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EUR/GBP on the Rise: Key Levels to Watch for a Potential Breakout
The EUR/GBP currency pair appears to be gaining traction within a trading range characterized by recent fluctuations. Currently, the pair is showing signs of a bullish leg developing as it seeks to recover from two and a half year lows. The technical indicator, MACD, has crossed above its signal line and remains above the zero mark, reinforcing the notion of a potential upward movement.
In the short term, EUR/GBP seems to be operating within a sideways trend. Technical analysis principles indicate that the price trend may persist in its current direction until a definitive breakout occurs. This creates a scenario where the currency pair continues to oscillate before choosing a direction, either upward or downward.
Recent price action revealed two instances of a false breakout to the downside. After breaking lower on November 8, the pair quickly returned within the trading range. Similarly, on November 22, an intraday dip failed to gain momentum. This behavior suggests a resilience at the current levels, raising the likelihood of a recovery towards the upper boundary of the range, around 0.8450.
For traders watching this pair, a breach above the 0.8375 level could set the stage for a further rally towards a target of 0.8440, located just beneath the range’s ceiling. With the MACD indicating bullish momentum in the current sideways market, the pair holds potential for upward movement as it attempts to capitalize on this favorable technical setup. Overall, market participants should remain attentive to price action around these key levels, as a decisive breakout could lead to increased volatility.
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