EUR/GBP Price Forecast: Under growing bearish pressure below 0.8550

The Euro (EUR) has been experiencing a decline for two straight days against the British Pound (GBP), as market sentiment remains cautious due to dwindling hopes for a quick resolution to Iran's conflict and rising oil prices. The EUR/USD pair has fallen below the 0.8550 mark, which it had reached two weeks ago, after hitting its lowest point of 0.8536 on Monday.

With no major economic data releases from the UK or the Eurozone, geopolitical tensions are driving the market on Tuesday. Rabobank's strategists warn that while the Eurozone's economy seems to have managed the higher energy prices and disruption of supplies from the Strait of Hormuz closure, the collapse of the US-Iran peace deal implies significant downside risks to growth and inflation concerns, putting pressure on the Euro.

EUR/GBP broke out of its ascending channel in late July and confirmed the bearish reversal this week after falling below a key support level at the 0.8550 area, now acting as resistance for bulls. Momentum indicators suggest a bearish outlook, with the 4-hour Relative Strength Index (14) at mid-30s and the Moving Average Convergence Divergence (MACD) slightly negative.

Support is seen at the July 24 low of 0.8530, with a potential break of 0.8510 below, which could signal a return to previous ranges and renewed focus on Monday's highs around 0.8566 and August's 0.8580.