EUR/GBP edged lower to 0.8470 last week but rebounded strongly strong there. A short term bottom should be formed. Initial bias is mildly on the upside this week for 38.2% retracement of 0.9291 to 0.8470 at 0.8784. Sustained break there will raise the chance that whole corrective pattern from 0.9499 has completed with three waves down to 0.8470. Stronger rise would then be seen back to 61.8% retracement at 0.8977 next. However, on the downside, , below 0.8580 minor support will bring retest of 0.8470 support instead.
In the bigger picture, we’re seeing the price actions from 0.9499 as developing into a corrective pattern. That is, up trend from 0.6935 (2015 low) would resume at a later stage. This will remain the favored case as long as 0.8276 support holds. However, firm break of 0.8276 support will suggest that rise from 0.6935 has completed and turn medium term outlook bearish.
In the long term picture, rise from 0.6935 (2015 low) is still in progress. It could be resuming long term up trend from 0.5680 (2000 low). Break of 0.9799 (2008 high) is expected down the road, as long as 0.8276 support holds.