Currency Pair: EUR/GBP
Chart: 15 Min Charts
Short-Term Bias: Short
The EUR/GBP continues to hold above the channel, and has found short-term support near 0.7972 (78.6% Fib level). We expect the euro-pound to hold within 0.7994 and 0.7971 for the remainder of the trading session, and forecast the pair to fall below its current level later in the week.
We expect a short-term correction to be under way as the RSI reflects a bearish divergence, and could be on its way to test 0.7948 (61.8% Fib level) for support. The euro-pound has already broken below the upper channel within the last few hours of trading, and is expected to continue its move to the downside. If the pair finds enough downward momentum, we forecast 0.932 (50.0% Fib level) to be the next level of support. However, the fundamental event risks scheduled for the next 24 hours may call for a change in our outlook.
Analysis
The EUR/GBP has traded within 0.8098 and 0.7742 since March, and may offer profitable opportunities for forex traders. Last Friday, the pair jumped to break above the channel, and triggered overbought RSI signals throughout the trading session.
The pair looks to have found support near 0.7972 (78.6% Fib level), and continues to trade above the upper channel. A bearish divergence has emerged for the EUR/GBP, and has brought us to the conclusion that a correction may be in the works. We expect price action to fall back within the channel over the next trading session, and may find support at 0.7948 (61.8% Fib level). Be sure to check out Jamie’s Technical Outlook for the additional information on the major currency pairs.
