EURGBP trades near 2016/2017 lows

Technical Analysis

Author: Greg Michalowski | eurgbp

Like the EURCHF, the pair sits on an edge

The EURCHF is trading near the edge of a cliff on the weekly chart (see post here).  So is the EURGBP.  

Like the EURCHF, the pair sits on an edge

Looking at the weekly chart above, the swing lows from 2060 in 2017 came in at 0.8304 and 0.8310 respectively.  At the end of 2019, the price of the pair move below that area on its way to a swing low of 0.8259. However, the price rebounded and the scare of lower levels was avoided.

Last week and again today, the price has dipped back below the 0.8304 level.  Last week the low price reached 0.82949. The price for the week closed at 0.8300. In trading today, the price has moved even lower to a swing low of 0.82814. However once again the price has rebounded and we currently trade at 0.8308.

The risk remains that the downside momentum accelerates. However so far, the downside has been limited.

Drilling to the hourly chart below, the price high today stalled near its 100 hour moving average (blue line in the chart below). The price peaked above that level but quickly reversed to the session lows at 0.82814. The price has not closed an hourly bar above its 100 hour moving average since February 10. If the price can stay above the lows from last week at 0.82949, we could see further corrective price action back toward that key 100 hour moving average. However, it will take a move above that moving average to reverse some of the bearish bias.

EURGBP scripts along the bottoms.

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