FxWirePro: EUR/GBP breaks above 21-EMA, Bullish Divergence to drive further gains

EUR/GBP chart - Trading View 

Technical Analysis: Bias Bearish

- EUR/GBP trades 0.34% higher on the day, hits 5-day high

- Price action has broken above 21-EMA and is on track for further upside

- 5-DMA has turned and Stochs and RSI show bullish rollover from oversold territory

- Bullish divergence on Stochs and RSI adds to the upside bias

Data Released:

- UK unemployment rate unexpectedly dropped to 5% in January, beating consensus estimates for a modest uptick to 5.2% and compared to prior month's 5.1%. 

- Number of people claiming unemployment-related benefits jumped to 86.6K as against the 20.8K decline recorded in the previous month 

Support levels - 0.8614 (21-EMA), 0.8588 (5-DMA), 0.8578 (200H MA(

Resistance levels - 0.86 (Upper BB), 0.8686 (55-month EMA), 0.8719 (55-EMA)

Summary: Vaccine-related squabble between the UK and EU seemed to affect the GBP. Focus on scheduled speeches by the BoE Governor Andrew Bailey and Deputy Governor Jon Cunliffe, which might influence the pound. 

EUR/GBP set for further gains as price action breaks above 21-EMA. Major trend still remains bearish. Doji on the previous week's candle raises scope for further gains. Next bull target lies at 23.6% Fib at 0.8697.