Home Daily Analysis Charts / Trade Ideas EURGBP Losing Steam!

EURGBP Losing Steam!

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Daily Chart


Chart 1 – EURGBP Daily (Click on the top-right  arrowed square to enlarge the chart)

The EURGBP has been moving in a bullish fashion since the 6th of May when it bounced off of its 0.84900 support. On May 31 it touched the 0.88747 level to move back and create a shooting star candle.

The Stochastic has been descending, although still in the oversold area. The MACD is turning down and seems to begin a new bearish phase, and its histogram showing divergence. Finally, the CCI is bullish but retracing, creating another divergence.

240-min Chart

Chart 2 – EURGBP 4H (Click on the top-right  arrowed square to enlarge the chart)

The 4H chart shows that the 0.88747 level has been rejected with a candle that, in combination with the previous one is a Key reversal candle. Then, the price continues moving down breaking the lows of the large green candle.

Stochastics, and MACD points to more retracement, and the CCI is moving to the negative side and picturing a known Woodies reversal pattern.

All this shows that the bulls must wait for strength before entering new positions. The price may find support at 0.87650, therefore, short-term bear positions are possible, but being attentive to the action of the price when approaching this level.

The invalidation level for this scenario is the recent high at 0.88747

 

 

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