EUR/GBP Trend Down?
Eddie Tofpik | Feb 02, 2018 07:21
Until about the middle of January I would have said the market had continued its sideways move of last 2017 into this year as we saw (highlighted on the Daily Chart above) two consecutive closes below all the MAs and the key 50% Fib of the October 2016 - December 2016 move (0.8834) as well as an Indecisive Doji Cross for the January high...and neither were exploited in their moves.
Only on the 17th of January did we see the final impetus away from the Sideways movement take place with a Key Reversal Down. This was hesitatingly exploited but exploited nevertheless and we tested the November and December 2017 lows. The retracement in this case has been limited and has not even managed to overcome the 50% Fib at 0.8834. Hence, this market is starting to exhibit significant Bearishness and why I've moved the bullet point above into mildly Bearish.
Not all MAs are following yet but I ask you to remember that MAs are lagging indicators and slow to move at first. That being said, three are basically pointing downwards so that is sufficient justification. Looking at this, one can look at the action early November 2016-to-date as a Bearish Channel (currently 0.8621 - 0.8906). I'd be interested if we could see the market go below 0.8685 this week and close below 0.8790...that'd make it a Key Reversal Down on the Weekly Chart. However, I am realistic to realise that one should accept what you get rather than dream of Patterns or moves. I'd add one other item, one could look at the last two weeks action and see it as a Halfway Hesitation Pattern. In which case look to 0.8610 as a possible 'X'. Little too early to say yet or even put on the Daily Chart above...However, worth saying.
Support is currently at 0.8730, 0.8708, 0.8685, 0.8647, 0.8623(dynamic), 0.8597 and 0.8552.
Resistance is currently at 0.8760, 0.8783, 0.8800, 0.8834, 0.8855 (dynamic), 0.8893 and 0.8906 (dynamic).
Disclaimer: ADM Investor Services International Limited is authorised and regulated by The Financial Conduct Authority. Member of The London Stock Exchange. Registered office: 4th Floor Millennium Bridge House, 2 Lambeth Hill, London EC4V 3TT. Registered in England No. 2547805 a subsidiary of Archer Daniels Midland Company. Risk Warning: Investments in Equities, CFDs, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value, investors should therefore be aware that they may not realise the initial amount invested, and indeed may incur additional liabilities.
Get The App
These Investments may entail above average financial risk of loss, and investors should therefore carefully consider whether their financial circumstances and investment experience permit them to invest and, if necessary, seek the advice of an independent Financial Advisor. Some services described are not available to certain customers due to regulatory constraints either in the United Kingdom or elsewhere. © 2014 ADM Investor Services International Limited 2014.
/h3
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.