EUR/GBP at a Tipping Point: Key Demand Zone or Breakdown Ahead?The EUR/GBP cross is currently trading in a key technical area, hovering around 0.8427, showing signs of mild recovery after a bullish reaction from a previously tested demand zone.
📊 Technical Analysis
Price action reveals a compression phase within a descending channel (corrective flag), followed by a breakout to the upside last week. Price reached the supply zone between 0.8480 and 0.8535, which triggered a strong bearish candle rejection.
Currently, the pair is testing support around 0.8400–0.8380, a level previously defended by buyers.
The RSI bounced from oversold territory, suggesting the potential for a consolidation phase or sideways movement, rather than a clear divergence.
📌 Key Levels
Dynamic Resistance: 0.8480 – 0.8535
Structural Support: 0.8380 – 0.8285
Upside breakout target (if momentum builds): 0.8660
📅 Seasonality
Historically, June tends to be slightly bullish for EUR/GBP, especially on the 5-year and 10-year seasonal patterns. Curves indicate upward pressure between the second and third weeks of the month, suggesting that any retracement could present a seasonal long opportunity.
💼 COT Report
Euro FX
Non-Commercials reduced both longs (-1.7K) and shorts (-6.7K) → signaling indecision or rebalancing.
Net positioning remains positive, but momentum is fading.
British Pound
Non-Commercials added significantly to longs (+14.2K) and slightly to shorts (+2.8K) → GBP is attracting bullish interest.
This could reduce upside pressure on EUR/GBP in the short term.
Overall, COT data currently favors the British Pound in the near term.
📈 Retail Sentiment
Retail traders are heavily skewed to the long side (74% long), which may create contrarian downside pressure if the market moves against the crowd. The average entry price is around 0.8481, meaning many traders are currently underwater.
🎯 Conclusion & Bias Outlook
Short-term bias: Neutral to bearish down to 0.8380
Mid-term bias: Moderately bullish if price holds above 0.8380 with higher lows confirmation
Ideal long entry could emerge from a retest of 0.8380 with bullish confirmation (candlestick or RSI support)
Alternatively, a clear H4 close below 0.8380 could open space down to 0.8280
