The European common currency has appreciated substantially against the Sterling both in long and short term, as it is currently located at its highest level since 2009.
The rate has been trading in an ascending channel in force since mid-July. The strong bullish momentum has guided the pair along the upper channel boundary for the last trading week, thus forming an ascending wedge.
This junior patter, however, may no longer be able to confine the pair, thus eventually resulting in a breach southward, setting the lower channel boundary circa 0.9220 as a possible downside target. In case bulls manage to prevail for some time more, the Pound may still be pushed up to the monthly R3 at 0.9310.
The rate has been trading in an ascending channel in force since mid-July. The strong bullish momentum has guided the pair along the upper channel boundary for the last trading week, thus forming an ascending wedge.
This junior patter, however, may no longer be able to confine the pair, thus eventually resulting in a breach southward, setting the lower channel boundary circa 0.9220 as a possible downside target. In case bulls manage to prevail for some time more, the Pound may still be pushed up to the monthly R3 at 0.9310.
Trade closed: stop reached:
The long term pattern was not taken into account, which caused a reversal of direction.
