EUR/GBP: Visits the 200 day EMA

The 200 day exponential moving average or EMA, could act as a good support or resistance zone, especially when the price suddenly visits the moving average after a prolonged drop or rally. The Euro strengthens versus its main counterparts after the European Central Bank failed to provide enough economic stimuli as the market was anticipating. That is why we can see on the daily chart of the EUR/GBP that the price reaches the 200 day EMA (blue line), around the 0.7244 level, which coincides with the 50% Fibonacci retracement of the recent drop and stalls there. It is possible for that EMA to act as resistance and the price may try to bounce to the 55 day EMA (purple line), around the 0.7143 level, which could act as support. Above the 50% Fibo, the 61.8% Fibo could also act as resistance in case the price continues going higher, especially when it is just around the 0.7300 round number level.