Hello Traders!
For the past two months, EUR/GBP has been consistently producing lower lows and lower highs while forming a descending wedge pattern. This is a very bullish pattern, which today got broken to the upside. Perhaps we are witnessing the beginning of a strong upside move, which might take place throughout this week.
After the price broke above the downtrend trendline, it pulled back and rejected the 200 Exponential Moving Average as well as the downtrend trendline at the same time. Then a new higher high has been printed, yet again confirming a strong bullish sentiment for EUR/GBP currency pair.
As long as 4h closing prices remain above recently established support at 0.9080, EUR/GBP should be expected to continue rising. This uptrend might bring the price as high as 0.9242, which is 120 pips away from the current price. This upside target or resistance level is confirmed by two Fibs. First is the 50% Fibs applied to the last wave up, when EUR/GBP topped out back on September 11. The second is 627.2% Fibs applied to the current pullback, where 200 EMA was rejected. Both of these Fibonacci retracement levels are pointing out to 0.9242, the nearest, and key resistance.
In regards to the downside risk, only a 1-hour and/or 4-hour break and close below the 0.9080 support can invalidate an extremely bullish outlook. In this case, the consolidation phase is likely to start, and in the worst case, the downtrend will continue.
Key support levels: 0.9080
Key resistance levels: 0.9242
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Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
For the past two months, EUR/GBP has been consistently producing lower lows and lower highs while forming a descending wedge pattern. This is a very bullish pattern, which today got broken to the upside. Perhaps we are witnessing the beginning of a strong upside move, which might take place throughout this week.
After the price broke above the downtrend trendline, it pulled back and rejected the 200 Exponential Moving Average as well as the downtrend trendline at the same time. Then a new higher high has been printed, yet again confirming a strong bullish sentiment for EUR/GBP currency pair.
As long as 4h closing prices remain above recently established support at 0.9080, EUR/GBP should be expected to continue rising. This uptrend might bring the price as high as 0.9242, which is 120 pips away from the current price. This upside target or resistance level is confirmed by two Fibs. First is the 50% Fibs applied to the last wave up, when EUR/GBP topped out back on September 11. The second is 627.2% Fibs applied to the current pullback, where 200 EMA was rejected. Both of these Fibonacci retracement levels are pointing out to 0.9242, the nearest, and key resistance.
In regards to the downside risk, only a 1-hour and/or 4-hour break and close below the 0.9080 support can invalidate an extremely bullish outlook. In this case, the consolidation phase is likely to start, and in the worst case, the downtrend will continue.
Key support levels: 0.9080
Key resistance levels: 0.9242
Thanks for your support! If you liked this analysis, please support our profile with a 👍 and follow us to get a new daily analysis.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
