EUR/GBP: Break below 0.8490 can extend the decline towards next projections at 0.8455/0.8440 – SocGen

EUR/GBP dip buyers emerge ahead of psychological support of 0.8500. Economists at Société Générale analyze the pair’s technical outlook.

Failure to overcome 0.8580 can denote risk of one more down leg

EUR/GBP recently defended last August low near 0.8490. The rebound has so far remained contained near 50-DMA at 0.8580. 

Daily MACD has posted positive divergence denoting receding downward momentum but a break beyond 0.8580 would be crucial for confirming short-term upside. Failure to overcome this can denote risk of one more down leg. 

Break below 0.8490 can extend the decline towards next projections at 0.8455/0.8440 which is also the trend line connecting lows of December 2022 and July 2023.