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EUR/GBP - Triangle Awaiting Breakout

The EUR/GBP price action this week can be described 2 ways.

First of all, looking at the 1H chart, we can see a triangle forming.

Another way to look at it is that there was a spike in volatility to start the week after which volatility cooled off. Then, during the 7/1 session, there was another spike in volatility, but not as violent as the start of the week. This second perspective is more descriptive of the triangle that is forming. 

EUR/GBP 1H Chart 7/2
(click to enlarge)

Price is starting the 7/2 US session inside the cluster of 200-, 100-, and 50-hour simple moving averages. A break above the cluster will also break the triangle resistance, which would open up the 0.7167 high, with risk of pushing higher in the short-term. In fact, price is starting to crack the triangle resistance as I write this post. 

If price indeed pushes higher, there is upside risk towards the 0.7195-0.72 area. Because the prevailing trend is still bearish, we should probably expect resistance here around 0.72.

The most aggressive bullish outlook at the momentum should probably be limited to the 0.7258 support/resistance pivot (base of a previous double top seen in the 4H chart).

EUR/GBP 4H Chart 7/2
(click to enlarge)

Now, if price fails to break 0.7125, the bearish outlook would still be in play. Then, a if a 4H candle closes below 0.7070, we are likely back in the bearish mode, with 0.7025, then 0.6983 in sight. After all, the ECB is still in QE mode, while the BoE is holding with anticipation of a rate hike in 2016 given its economic and inflation projections.