FxWirePro: EUR/GBP dumped hard as pound buoyed on positive Brexit news, finds support at 21-EMA, further weakness on break below

EUR/GBP chart on Trading View used for analysis

• EUR/GBP slumps overnight as the pound rallied on positive Brexit news.
   
• Upbeat momentum in the sterling was triggered on comments from the European Union’s chief Brexit negotiator Michel Barnier who said the bloc was prepared to offer Britain an unprecedentedly close relationship after it quits the EU.
   
• EUR/GBP came off from highs of 0.9091 to hit lows of 0.8976, dropping a massive 115 pips.
   
• The pair is extending weakness and is trading 0.09% lower on the day at 0.8977 at the time of writing.
   
• Price action is holding support at 21-EMA at 0.8973 and we see further weakness only on break below.
   
• Major trend is bullish. Break below 21-EMA can see weakness till 50-DMA at 0.8907. Violation at 200-DMA could see reversal in trend.

Support levels - 0.8974 (21-EMA), 0.8907 (50-DMA), 0.8828 (200-DMA)

Resistance levels - 0.9029 (5-DMA), 0.9098 (Aug 28 high)

Recommendation: Watch out for break below 21-EMA for weakness.

FxWirePro Currency Strength Index: FxWirePro's Hourly EUR Spot Index was at 2.87824 (Neutral), while Hourly GBP Spot Index was at 121.809 (Bullish) at 0430 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.