- EUR/GBP remains pressured after refreshing 19-month high the previous day.
- Overbought RSI adds strength to the pullback moves targeting the previous double-top.
- Bulls can aim for late 2020 lows beyond 0.8785.
EUR/GBP reverses from a nine-month-old resistance as it drops to 0.8768 during early Tuesday morning in Europe. In doing so, the cross-currency pair also respects the overbought RSI conditions, as well as sluggish MACD.
That said, the quote’s latest weakness eyes the previous double tops, now the key support around 0.8720.
However, the 0.8700 threshold and a two-week-old support line around 0.8660 could restrict the EUR/GBP pair’s further downside.
In a case where the pair breaks the 0.8660 support, the odds favoring its slump towards the monthly low surrounding 0.8565 can’t be ruled out.
Alternatively, an upside clearance of the stated resistance line, at 0.8785 by the press time, needs validation from the 0.8800 round figure to direct the pair buyers towards the late 2020 swing lows around 0.8865-70.
It’s worth noting that the EUR/GBP run-up beyond 0.8870 won’t hesitate to challenge the 0.9000 psychological magnet.
Overall, EUR/GBP is likely to witness a pullback from the multi-day high but the bullish trend is likely to prevail.
EUR/GBP: Daily chart
Trend: Pullback expected