- EUR/GBP has reverted to the trading range it has occupied since late September.
- The pair is likely to continue fluctuating within this range until a decisive breakout occurs in either direction.
- The failed downside breakout in early November indicates potential weakness at the range's lower boundary.
EUR/GBP remains confined within its established trading range, suggesting a sideways trend is in play. Following the technical analysis adage, "the trend is your friend," the pair is likely to continue oscillating until a decisive breakout occurs in either direction.
EUR/GBP 4-Hour Chart:
On November 8, the pair briefly broke lower, hitting a two-and-a-half-year low of 0.8260. However, the move proved to be a false breakout, as EUR/GBP quickly rebounded back into its range, where it currently remains.
Given the sideways trend, the likelihood leans toward continued range-bound movement. This suggests a potential recovery from the current level near the range floor, with a possible upward move toward the ceiling around 0.8450.
However, it remains uncertain whether EUR/GBP will reach the top of the range. The earlier false breakout may signal underlying weakness, raising the possibility of another breakdown and introducing a bearish undertone to the chart.
If a downside break occurs, the pair could decline toward the range target at 0.8219, aligning with the 61.8% Fibonacci extension level.
