EUR/GBP favours the bulls ahead of the budget. Can the Chancellor break the FTSE out of its current range?

EUR/GBP  favours the bulls ahead of the Budget

• EUR/GBP is trading in a tight range ahead of the Budget (FXE, FXB).
• Furlough extension, high street support & home buyer help aimed at faster economic recovery.
• EZ &UK PMI data due later

Where next for EUR/GBP?

EUR/GBP trades around 0.8660 heading towards the European open.

The pair crossed above its three month descending trendline in the previous session a move which favours the bulls.

The bullish MACD is also supportive of a move higher. 

Immediate resistance can be seen at 0.87 the 20 sma on the daily chart. Beyond here bulls could look towards 0.8800 horizontal resistance and round number.

On the downside a move back below the descending trendline could see bears target 0.86, a close below this level is needed to convince the bears to jump in with 0.8540 last week’s spike lower a then possible target.

FTSE range bound waiting from cues from Budget

The FTSE along with other EU markets are advancing despite a weak handover from Wall Street and China’s service sector activity growing at the slowest pace in 10 months.

Treasuries have stabilized ad optimism is stemming from hope that US stimulus will re-energise the global recovery.

Where next for the FTSE?

The FTSE has been trading within a holding pattern since mid-January, capped on the upside by 6800 and on the lower side by 6450.

The FTSE trades on its 20 & 50 sma on the daily chart which are both flat suggesting that the bias is neutral. The RSI is also hovering around 50 confirming the neutral bias so it could be prudent to wait for further directional signals. 

Bulls might look for a break out above 6800 which could bring the yearly high 6970 into focus.

On the downside the bears might look for a move below 6450 in order to target 6305 the yearly low.