Since the beginning of this year, the FX pair EURGBP has made a fast reverse, leaving its downside trend for a very bullish construction. On that situation, as long as the tops and bottoms remain higher than the previous ones, we should look for potentially interesting entry points. Here, we probably got one due to the following reasons :
- beginning of a bounce at 0.88750, matching with the 38.2% retracement of the previous impulsion. - neutral RSI, which means that the pair is no longer overbought - the bounce is near an ascending trendline support that gives a great indication about the pace of the bullish wave. - the 200 days moving average is well oriented and tends to accelerate : the underlying mid term trend is in the direction of the trading idea
On that situation, initiating a long position on EURGBP is appropriate, with : - target @ 0.92155 - stop @ 0.88200 Reward/Risk ratio = 2.2