EUR/GBP to challenge a key support level

On the four-hour chart, EUR/GBP has been trading within a mild ascending channel since early August, following a crossover above the 50-EMA. Intensifying bearish momentum has contributed to lowering the price to the channel’s support at 0.84361, which is in line with the 50-EMA dynamic support as well. If this confluence can’t halt the decline, it may lead the pair to close the session below this hurdle, which can put a further drop on the cards. In that case, the short-lived upward movement will end, and sellers’ attention will turn to the 0.84172 level of interest, the previous market bottom, made on August 10. A decisive break of this barrier can push the price lower to test the 0.83990 mark.

Otherwise, if the channel holds support, buyers will retake their seats to make a rebound in the next session and keep the channel intact. In the bullish scenario, the immediate resistance comes from the 200-EMA, lining up with the 0.84691 barricade.