- The euro slightly edged lower against the British pound amid hopes that a deal will be struck before the end of the year to avoid a potentially disruptive break in trading relations.
- However, the downside in the pair appears limited as investors also priced in the risk of Britain failing to agree a trade deal with the EU in the 11 months left of the Brexit transition period.
- EUR/GBP is trading 0.1 percent down at 0.8487, having hit a high 0.8504 earlier, its highest since February 4.
- Technical indicators are bearish on hourly charts: RSI weak at 49.31, MACD supports downside and Stochs are biased lower.
- Immediate resistance is located at 0.8517 (5-EMA), a break above could take it near 0.8537.
- On the downside, support is seen at 0.8475 (20-EMA), a break below could drag it till 0.8460 (10-DMA).
Recommendation: Good to sell on rallies around 0.8490, with stop loss of 0.8505 and target price of 0.8460.
