Falls to fresh monthly lows around key support of 0.8935-30

• EUR / GBP remains under intense selling pressure for the fourth day in a row.
• The oversold conditions on the 1 hour chart warrant caution before opening new bearish positions.
• The cross still appears vulnerable to extending the slide to retest the November 2020 lows.

The EUR / GBP cross has seen strong selling for the fourth day in a row on Tuesday and has continued to lose ground during the European session. Momentum has dragged the cross to fresh monthly lows, with bears now targeting continuation weakness below the 0.8935-30 region.

With the oscillators on the daily chart staying in negative territory and still far from being in the oversold zone, a convincing breakout will be seen as a new trigger for bearish traders. This, in turn, could make the EUR / GBP cross vulnerable to further weakening below the round level of 0.8900.

The next relevant target for the bears is at the November lows, around the 0.8860 region, which has been acting as a solid foundation for the EUR / GBP cross since June 2020. The lack of defense of the mentioned support level should pave the way for an extension of the downward movement.

Meanwhile, technical indicators on the 1-hour chart already show oversold conditions and warrant some short-term consolidation or a modest bounce before the next move down. That said, any recovery attempt is more likely to remain capped near the 200-day SMA, around the 0.8980-85 region.

A subsequent move back above the 0.9000 key psychological level could negate the short-term bearish outlook and trigger some short coverage move. The EUR / GBP cross could rise towards the intermediate resistance at 0.9055-60 on the way to the next big hurdle, just below the 0.9100 level.

EUR / GBP 4-hour chart

EUR / GBP technical levels