- The pair has been down trending by following a bearish trend line in the H4 chart
- The price is heading towards the trend line resistance
- The H1 chart had a bounce at a key level of support twice
- It is about to make a bullish breakout at the neckline
EUR/GBP H4 Chart
EUR/GBP H4 Chart Obeys a Bearish Trend Line
The pair has been bearish in the H4 for the last three trading days. It had rejection three times at the trend line’s resistance. Thus, the sellers may keep their eyes on the pair to produce a bearish reversal candle to go short. Simple Moving Average 30 has been working as a level of resistance as well. If the price makes a breakout at 0.85900, the pair may head towards the downside with good bearish momentum. The level of 0.85500 may hold the price as a level of support. The pair traded around that level for quite a while earlier. It would be a level that traders should deal with carefully. On the other hand, if the price makes a bullish breakout at the trend line, the buyers may keep their eyes on pair to go long upon having breakout confirmation.
EUR/GBP H1 Chart
The H1 Chart Tells a Different Story
The H1 chart’s price action has been bullish. The price had a bounce at the level of 0.85900 twice. At the last bounce, it produced a strong bullish candle followed by a neckline breakout. Traders must wait for the chart to confirm the breakout to go long. If that happens, the H1 traders may push the price towards the North. In that case, the price may find its next resistance around 0.85350. On the other hand, if the price makes a bearish breakout at 0.85900, the price may find its next support around 0.85500.
The H4 chart looks bearish as long as the trend line acts as a level of resistance. However, the H1 chart’s price action has been bullish. If the chart continues to produce bullish price action, the pair may end up having a bullish day and making a bullish breakout at the H4 trend line.
Written by: Md Tareq Sikder, Senior Analyst Forex Prop News
Contact and follow Tareq on Twitter: @tareqfpn