Market NewsTechnical Analysis

EUR/GBP: Takes Time to Find Its Next Direction

Euro Highs Weakening US Dollar
  • EUR/GBP has been choppy on the H4 chart.
  • The pair trades below the SMA 30, but it has not produced any momentum.
  • The H1 chart may find a double top resistance on a bearish trend line.
  • Intraday minor charts have been choppy.
EUR/GBP H4 chart
EUR/GBP H4 chart

EUR/GBP – Technical Analysis- H4 chart

The charts shows that the price after being bullish by obeying the SMA 30 found its horizontal resistance. It made a bearish move with good momentum. However, upon finding its support, it produced a bullish engulfing candle. Since then, it has been consolidating around the SMA 30’s resistance. It has not produced any significant bearish candle. It suggests that the SMA 30 has not played its part. Traders are to be very watchful to go short from that zone. If the price breaches the level of 0.86450, it may find its support around 0.86000.

On the contrary, if the price breaches the SMA 30 and confirms the breakout, the buyers may find long opportunities upon having bullish reversal pattern. The price may find its resistance at the last swing high in that case.

EUR/GBP H1 chart
EUR/GBP H1 chart

Price Action Analysis- H1 Chart

The H1 chart shows that the price has been consolidating around a trend line’s resistance. A bearish reversal candle followed by a price breach at 0.86650 may drive the price towards the South. The price may find its next support around 0.86500.

On the upside, if the price breaches the trend line’s resistance, the buyers may look to go long in the pair. In that case, it may find its next resistance around 0.87000.

Considering both charts, it seems that the pair is in decision making phase. Thus, traders are to be patient and watchful before making any trading decision based on the H4 and H1 chart.

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

Contact and follow Tareq on Twitter: @tareqfpn

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