FX.co ★ EUR/GBP candlestick analysis for May 5, 2011

Earlier in a daily graph the EUR/GBP formed a Long Shadows candlestick indicating further downside movement.
This candlestick shows that earlier the EUR/GBP pair made a strong upside movement after an unsuccessful attempt to break the support level 0.8300. However, it reversed near the 0.9000 level. This means that the bulls could not solidify here and the bears started to increase their influence.
The divergence on the RSI and the MACD supports the downside movement.
Break of the Fibonacci 23.6 correction level will prove this viewpoint. In this case we should expect downside movement with a target at 0.8740 where the Fibonacci 38.2 correction level is also located.