EUR/GBP extended its decline on Friday as the Euro continued to weaken against a resilient British Pound. Sterling has remained well-supported following the UK Autumn Budget, even with markets firmly pricing in a Bank of England rate cut on December 18.
At the time of writing, EUR/GBP trades near 0.8729, hovering around its lowest level since late October and heading for a third consecutive weekly loss.
Bearish pressure builds as EUR/GBP maintains downside bias
EUR/GBP has been under consistent downward pressure since peaking near 0.8865 in mid-November – the year-to-date high and the strongest level since April 2023. Since then, the pair has slipped below the 21-day and 50-day SMAs, indicating a clear shift toward a softer short-term structure as sellers remain firmly in control.
Despite the persistent downside pressure, the pair is still holding above the 100-day SMA around 0.8711, which acts as a key immediate support area. A decisive break below this level would elevate the risk of a deeper retracement toward the 0.8670–0.8650 region.
Momentum signals reinforce bearish outlook
Momentum indicators confirm the weakening trend. The MACD histogram has dipped into negative territory near the zero line, signaling fading bullish momentum. Meanwhile, the RSI sits at 39.83 – below the neutral 50 mark and highlighting a loss of traction, though still not yet in oversold territory.
Upside levels to watch
If EUR/GBP stages a corrective bounce, the 50-day SMA near 0.8751 stands as the first resistance hurdle. Above that, the 21-day SMA around 0.8787 forms the next barrier. A sustained break above both moving averages would be needed to revive bullish momentum and re-open the path toward the 0.8865 high and potentially higher levels.
