FX.co ★ Candlestick analysis of the EUR/GBP for 18/11/2010

At daily graph the EUR/GBP currency pair is rolling back from the Fibonacci correction level 61.8. It is forecasted that the currency pair will grow to the range of 0.8625-8.8650. Nevertheless, the viewpoint is bearish, since the downtrend is remaining. As it was mentioned before in case the mark of 0.8462 is broken through the downside movement to support level of 0.82 is expected.
Earlier on daily chart the EUR/GBP formed the combination of candlesticks Bearish Engulfing that indicates the downwards movement.
This combination of candlesticks shows that the currency pair was demonstrating the uprising motion during several weeks after it failed to break out the support level of 0.8067. However, having come closer to 0.8950 the pair reversed. This means that the bears activated here and did not allow bulls to solidify.
The breakthrough of the Fibonacci correction level 38.2 and support level of 0.8626 denotes that this point of view is correct.
It is recommended to set the stop orders above 0.8821, as the breakout of this mark will target the EUR/GBP to 0.8950.