EURGBP - Increasing chances for a short term bullish move
Daily: Ichimoku is naturally still bearish, that's not a question. However ADX climbed pretty high, which alone means the bearish trend was strong so far, but together with momentum indicators, which have given bullish signals it may ring the bell for the Bears. We may see a minimum correction up to the trendline and the Kijun Sen ard 0,8025.
What else is needed to get a momentum for the correction? Of course some more bullish signals on the 4 Hrs time frame.
4 Hrs: Slow Stoch and DMI are bullish, and very important that after bullish DMI cross ADX is ard 20 and increasing. After previous weak Tenkan/Kijun cross (which happened below the Kumo), price retested Kijun Sen, but did could not stay below, printing a higher low. The recent Tenkan/Kijun corss is already a medium bullish one, as it happened within the Kumo. What is also important that Chikou Span crossed above price candles, which is also small bullish indication. But until Price trades in the Kumo, it is rather a neutral stage.
The short term Key Support/Resistance is very clear! 0,7968-0,7972. In case price breaks through that key level, some of the Bears start to close shorts and short term counter traders will enter on the long side as well.
We are pretty close to this last reversal signal, so watch it carefully! How long the correction will last? Of course I don't know. No one knows. What we see on the chart are only the important levels, where you have to watch price action and indicators again. These are around: 0,8025 and 0,8080. What we also see now is that the chance for this reversal to happen is increasing.
If you take a long position, the initial risk-reward to Target-1 (0,8025) doesn't look too good, since it is only abt 1,50, but as the move starts, it will likely be a sharp and quick one, and then you can trail your initial stop up to 0,7947 and later to break even.
Fyi if I enter this trade, I will do only 0,5-1 trade unit, will not size it up, since I am already looking to sell GBPUSD too - pls see related idea. (Also have already some put options for the Cable). Money management is very important, I never take bigger risk than 4 trade units all together in strongly correlated products or pairs, especially not in counter trend (swing) trades, which normally I play only with 0,5-1 trade units max in each instruments.
What else is needed to get a momentum for the correction? Of course some more bullish signals on the 4 Hrs time frame.
4 Hrs: Slow Stoch and DMI are bullish, and very important that after bullish DMI cross ADX is ard 20 and increasing. After previous weak Tenkan/Kijun cross (which happened below the Kumo), price retested Kijun Sen, but did could not stay below, printing a higher low. The recent Tenkan/Kijun corss is already a medium bullish one, as it happened within the Kumo. What is also important that Chikou Span crossed above price candles, which is also small bullish indication. But until Price trades in the Kumo, it is rather a neutral stage.
The short term Key Support/Resistance is very clear! 0,7968-0,7972. In case price breaks through that key level, some of the Bears start to close shorts and short term counter traders will enter on the long side as well.
We are pretty close to this last reversal signal, so watch it carefully! How long the correction will last? Of course I don't know. No one knows. What we see on the chart are only the important levels, where you have to watch price action and indicators again. These are around: 0,8025 and 0,8080. What we also see now is that the chance for this reversal to happen is increasing.
If you take a long position, the initial risk-reward to Target-1 (0,8025) doesn't look too good, since it is only abt 1,50, but as the move starts, it will likely be a sharp and quick one, and then you can trail your initial stop up to 0,7947 and later to break even.
Fyi if I enter this trade, I will do only 0,5-1 trade unit, will not size it up, since I am already looking to sell GBPUSD too - pls see related idea. (Also have already some put options for the Cable). Money management is very important, I never take bigger risk than 4 trade units all together in strongly correlated products or pairs, especially not in counter trend (swing) trades, which normally I play only with 0,5-1 trade units max in each instruments.
