FxWirePro: EUR/GBP trades narrow range below 5-DMA, eyes 50-DMA at 0.9026, stay short

• EUR/GBP is trading an extremely narrow range and minor recovery attempts on the day capped below 5-DMA.
   
• The pair failed to retake 20-DMA in previous week's trade, has slipped below 0.91 handle.
   
• Technical studies are bearish. RSI and Stochs are sharply lower with scope for further downside.
   
• Immediate support seen at 0.9026 (50-DMA), violation there could see further drag.
   
• On the flipside, 20-DMA is major resistance above 5-DMA at 0.9132. We see upside only on break above. Scope then for re-test of channel top.
   
• UK inflation figures are due tomorrow and markets expect a small increase in headline inflation to 2.7 percent y/y in August, while core inflation is likely to remain unchanged at 2.4 percent y/y.
   
• Further, labour market data are due Wed. Employment is set have remained firm in July, likely rising by more than the 125k 3M/3M rate reported in June, while the unemployment rate is likely to be unchanged at the lowest level since 1975 at 4.4 percent.

Support levels - 0.9068 (23.6% Fib retrace of 0.82970 to 0.93064 rally), 0.9026 (50-DMA), 0.9007 (Aug 10 low)

Resistance levels - 0.9131 (5-DMA), 0.9150 (weekly 5-SMA), 0.9172 (20-DMA)

Recommendation: Good to go short on rallies around 0.91, SL: 0.9150, TP: 0.9070/ 0.9030/ 0.90

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