Sign up to create alerts for Instruments,
Economic Events and content by followed authors
Free Sign Up Already have an account? Sign In
Quotes
All Instrument Types
- All Instrument Types
- Indices
- Equities
- ETFs
- Funds
- Commodities
- Currencies
- Crypto
- Bonds
- Certificates
Please try another search
🌊 NVIDIA ripple effect: Track AI stocks' response to chip giant's earnings
Explore AI Stocks
EUR/GBP: Will The Pound Recover?
www.investing.com/analysis/eurgbp-testing-the-channel-263775
EUR/GBP: Will The Pound Recover?
By Blackwell Global (Ross Woodfield) | Sep 02, 2015 02:35AM ET The EUR/GBP pair has found some bids over recent weeks, but all this has served to do is test the channel it has been stuck in for the past 6 months. Can it break the shackles, or will the Pound recover?
The slight bearish bias on the channel is a sign that the market has been favouring the Pound over the Euro in recent months, thanks to the expectation that the Bank of England would raise interest rates sometime this year. That expectation has all but evaporated with the turmoil on global markets and the Euro has taken full advantage.
The recent test of the channel led to a very strong rejection off it, in a sign that the market was willing to defend the short bias on the pair. The RSI pushed into oversold, giving an indication that the move had gone too far, before retreating. The pullback only lasted a week with another charge higher yesterday with a second pullback in the Asian session today.
Both pullbacks are interesting and were largely predictable. They have come in an area of resistance that price has played off several times before. The 0.7387level acted as resistancein the channel and to support the pair before the channel formed. This level, coinciding with the dynamic resistance, was set up to rejected the pair. The question remains, will the channel hold?
The pattern that is forming currently is a rather classic looking double top. What favours the channel holding firm is the fact that the second ‘top’ is lower than the first, meaning the order flow is favouring the bulls defending the level. A confirmation will come if and when the neckline at 0.7245 is broken and price then uses it as resistance. This is the likely outcome, but not guaranteed.
If the channel holds, look for support to be found at the firm level (the neckline) mentioned above at 0.7245, with further support at 0.7117 and 0.7036. If the channel is breached, a meaningful break of the current resistance at 0.7387 will need to hold, as well as a break of the dynamic resistance along the channel. Further resistance will be found at 0.7485 and 0.7594.
Related Articles
USD/JPY Declines as BoJ Core CPI Climbs to 2.2%
By Kenny Fisher - Feb 26, 2025
The Japanese yen is slightly lower on Wednesday. In the North American session, USD/JPY is trading at 148.92, down 0.07% on the day. What is the best performing G-10 currency...
EUR/USD: A Clean Breakout Above 1.05 Remains the Base Case Scenario
By Fawad Razaqzada - Feb 26, 2025
EUR/USD remains resilient after dipping below 1.05, hinting at a potential breakout. Weak US data and stagflation fears fuel Fed rate cut bets, pressuring the dollar. A break...
GBP/USD Rebounds from Support – Bullish Setup Toward 1.2725
By Scott Barkley - Feb 26, 2025
Forex Strategy is Bullish: We are currently @ 1.2660 in a channel. Nice bounce here and if GBP/USD continues, we are looking for a continuation to the ATR target @ 1.2725 area,...
EUR/GBP: Will The Pound Recover?
Add Chart to Comment
Confirm Block
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.
Report this comment
I feel that this comment is:
Comment flagged
Thank You!
Your report has been sent to our moderators for review
Add a Comment
We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
Enrich the conversation, don’t trash it.
Stay focused and on track. Only post material that’s relevant to the topic being discussed.
Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.