After a strong rally for the past few weeks, the EUR/GBP pair hit a snag at the resistance level around 0.876. it closed above this point but was unable to sustain the rally, instead moving sideways before retreating. The pair then tested the resistance level at 0.871 attempting to turn it into support, but the presence of exhaustive candles showed signs of a strong bearish sentiment.
Prices kept going down to stop at the 23.6% Fibonacci level, but that too was broken, and the pair closed below this level. Today’s candle was unable to resume the recovery, which shows that the EUR/GBP pair may resume the downtrend in the short-term. The target for the downtrend will be the 38.2% Fibonacci level and support at 0.863.