• EUR/GBP failed to capitalize on the post-BoE rate cut move to five-month tops.
• The set-up seems tilted in favour of bulls and points to further near-term gains.

The EUR/GBP cross gained some intraday traction and spiked to fresh five-month tops, around mid-0.8800s, in reaction to the Bank of England's emergency rate cut on Wednesday.

However, the momentum faltered near a resistance marked by 50% Fibonacci level of the 0.9398-0.8276 downfall, which should now act as a key pivotal point for short-term traders.

Given that the cross finally seems to have found acceptance above the very important 200-day SMA, the bias seems tilted in favour of bulls and support prospects for additional gains.

However, technical indicators on the daily chart are on the verge of moving into overbought territory, which seemed to be the only factor holding traders from placing fresh bullish positions.

Hence, it will be prudent to wait for some strong follow-through buying beyond the mentioned barrier before positioning for a further appreciating move towards the 0.8900 round-figure mark.

Meanwhile, a sustained break below the recent daily closing lows support, near the 0.8640 region, might negate any bullish bias and pave the way for some near-term profit-taking slide.

EUR/GBP daily chart

Technical levels to watch