EUR/GBP Price Analysis: Slides from weekly highs and trade below the 200-day EMA

• EUR/GBP is losing in the week more than 1%.
• US equities are still rising, but the sentiment will turn cautious as the FOMC decision looms.
• EUR/GBP Price Analysis: In the long and near term, shifted downward biased.

The EUR/GBP tumbles for four straight days and, on its way south, breaks below the 100 and 200-day EMAs, shifting the pair bias downwards as it tests the July 13 swing low at 0.8403 amidst a positive market mood. At the time of writing, the EUR/GBP is trading at 0.8403.

Market players’ mood still hangs positive ahead of the US FOMC decision. Despite a gloomy scenario with high inflation, recession fears, although calmed but still lingering around traders’ minds, and slower economic growth, US equities are rising. In the case of the EUR/GBP, a worsening EU energy crisis has propelled the pound.

EUR/GBP Price Analysis: Technical outlook

From a daily chart perspective, the EUR/GBP pair shifted downward biased once it tumbled below the 50 and 200-day EMAs. Additionally, the Relative Strength Index (RSI) plunging within bearish territory motivated sellers to increase their positions, which piled around the weekly highs at 0.8500, sending the cross sliding 100 pips. Unless EUR/GBP buyers reclaim the 200-day EMA at 0.8439, sellers are in charge. Therefore, the EUR/GBP first support would be the 0.8400 figure. Once cleared, the cross might tumble towards the May 17 low at 0.8394, followed by May 2 daily low at 0.8367.

EUR/GBP 1-hour chart

The EUR/GBP 1-hour chart illustrates that the pair consolidates around the 0.8400-20 range, but the bias is downwards. Further reinforcing the trend is that the exchange rate is below the hourly EMAs, alongside the Relative Strength Index (RSI) below its 7-period SMA, so sellers are in control. Hence, the EUR/GBP first support would be the 0.8400 figure. Break below will expose the May 17 low at 0.8394, followed by the S1 daily pivot at 0.8378, followed by the May 2 swing low at 0.8367.

EUR/GBP Key Technical Levels