GBP/EUR Strategy Snap: Discovering Resistance

Image © Adobe Images

Pound sterling's rise against the euro reaches a potential ceiling.

It's been an unexpectedly fortuitous time for our readers who are looking to buy euros; the market's delivered a gain of 1.76% in a matter of 12 days, which is unusual for a pair that can be quite docile.

We've spoken to the dealing desk at Horizon Currency and are told that there's an abundance of order action up at 1.17, which tells us retail punters think this advance can continue.

And why not? The pros all said we should be closer to 1.11 at this stage of 2026, yet here we are.

The one point of caution to consider is that the run-up to 1.16 could encounter some resistance, as two recent rallies have faded around 1.1595 this week.

Casting our eyes back to early February also reveals this area to have disabled the bulls: the pound-euro exchange rate turned tail here and trended lower through February to touch 1.1383:

The Relative Strength Index (RSI) has risen to 64, which is usually a bullish signal, but GBP/EUR is peculiar in that it tends not to rise much beyond here.

That's probably to do with that observation I made that this is usually a docile exchange rate.

In fact, an RSI at 64-65 usually marks the top of a rally (the last time it hit the overbought 70 level was in 2024!) as a pullback or consolidation envelops the pair.

The technical setup is still largely constructive and the geopolitical backdrop is proving supportive and further gains towards 1.17 are therefore possible.

But it's worth keeping in mind that some risks are building, so covering some exposure here could be wise.