EUR/GBP: More Consolidation or Heads towards the North?

• EUR/GBP has found its support at the SMA 30 on the H4 chart.
• A horizontal level has been working as a support as well.
• The H1 chart has been bullish gradually moving towards the swing high.
• Intraday minor charts have been bullish.

EUR/GBP – Technical Analysis- H4 Chart

The chart shows that the price produced a hammer right at the simple moving average 30’s support. The next candle came out as an inverted hammer. However, the chart has been producing candles with tiny bullish bodies. Since the levelof 0.86000 has been working as a support as well, so it looks like that the price may head towards the North. If the price breaches the level of 086200, it may continue its move towards the North and find its next resistance around 0.86600.

On the downside, if the price finds its resistance and makes a bearish breakout at the SMA 30, it may find its support again at the last swing low. It means the price does not have enough space to travel towards the South. A breakout below the swing low may generate more momentum and drive the price towards the South further.

Price Action Analysis- H1 Chart

The chart shows that the price has been heading towards the upside. It consolidated within 0.86040-0.86090 for a while. As of writing, it seems that the price may end up making a breakout at the consolidation’s resistance. The level of 0.86200 may work as a level of resistance next. Traders are to be watchful on the price action around the level. A breakout above the level may push the price towards the North. It may find its resistance around 0.86400.

On the contrary, if the level produces a strong bearish reversal pattern, the sellers may come over and drive the price towards the South. Considering the H1 chart, it has enough space to travel towards the downside. Thus, the sellers may be interested to go short upon having a strong selling signal.

Written by: Md Tareq Sikder, Senior Analyst Forex Prop News

Contact and follow Tareq on Twitter: @tareqfpn