EURGBP looked impressive during yesterday’s session, rallying 100 pips to close the day above the .7290 key level. This move was especially impressive coming from a pair that just confirmed a double top two weeks ago and looked as though it would soon be retesting the 2015 lows.
While it’s too early to call this a major turning point for the pair, we can at least attempt to capitalize on the short-term bullish momentum by watching for a buy signal on any rotation lower to new support at .7290. This area has influenced price on several occasions since late February (see chart below).
We don’t have to look far to find key resistance from current levels. The .7378 area is sure to attract sellers should the pair retest this level over the coming sessions.
The docket for the pair looks fairly light to finish out the week. However do keep in mind that EURGBP will be sensitive to any developments surrounding Greece’s financial situation.
Summary: Watch for bullish price action on a retest of .7290 as new support. Key resistance comes in at .7378. Break that and we could see a much larger rally develop over the coming weeks.