Sunday saw the conclusion of the 4-day European Parliament elections. According to Reuters, eurosceptic nationalists gained significant votes, edging out liberals and greens.
Meanwhile, President Emmanuel Macron dissolved the French Parliament, calling for early legislative elections later this month following his defeat in the EU elections to Marine Le Pen’s far-right party.
This puts pressure on the European Union’s structure, weakening the euro.
As depicted in the EUR/GBP chart, Monday’s currency trading opened around 0.8465 – a level unseen since August 2022.
Today’s technical analysis of EUR/GBP indicates:
→ A downward break below the key support level of 0.85, active since 2023;
→ Price dynamics since autumn 2022 show a descending trend (as indicated by the red channel). A bearish breakthrough of 0.85 confirms this trend;
→ The median line of the channel may serve as a consolidation zone, reinforcing levels below 0.85, validating the channel’s relevance;
→ The 0.85-0.853 zone could pose significant resistance in the future if bulls attempt a correction.
In a negative market scenario (e.g., a political crisis within Europe), reaching the lower boundary of the mentioned channel by the EUR/GBP price is not ruled out.
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