EUR/GBP Price Analysis: Eroding key support level at 0.8680

• EUR/GBP capped below 0.8745, tests levels below 0.8680 support.
• Upside attempts remain limited below the 20-day SMA.
• Confirmation below 0.8680 might drive the pair towards 0.8620 and 0.8523.

The euro recovery attempt witnessed on Wednesday has been short-lived, and the pair has depreciated again, to explore prices below a key support level, at 0.8680. Euro rebound from week lows at 0.8688 has been unable to extend above the 20-day SMA, at 0.8750, and the pair has pulled lower on Thursday, weighed by a fairly disappointing ECB monetary policy statement.  

EUR/GBP daily chart

Technical indicators on the 4-hour chart show the EUR/GBP biased lower, capped below the 50 and 100 SMA, converging at 0.8745 area. If the pair confirms below the mentioned 0.8680 level (April 14 and 17 lows), the bearish trend might gain traction pushing the pair towards 0.8620 (March 5 low) and 0.8523 (Feb. 28 low).

On the upside, the pair should break above the 50 and 100 SMAs at 0.8745 to ease bearish pressure, aiming then towards 0.8865 (23.6% Fib. Retracement of the March-April decline and April 21 high) and then 0.8990 (March 30 high).

EUR/GBP 4-hour chart