Supported by "overlapping factors," EUR/GBP rose sharply at the start of the European session today, hitting 0.8584, 91 pips above today's opening price.
Having rebounded yesterday from the support level 0.8455 (200 EMA on the daily chart), EUR/GBP again headed toward the key resistance level 0.8625 (200 EMA on the weekly chart), separating the long-term bull market from the bear market.
However, trends do not break so quickly, and EUR/GBP has been trading in the bear market zone below the resistance level of 0.8625 since February 2022.
Therefore, near the resistance levels of 0.8625, 0.8615 (local resistance level), and 0.8600, we place pending Sell-Limit orders, counting on a rebound from these levels and the return of EUR/GBP to the global downward trend.
However, judging by the 1-hour chart, the price has already begun to correct after a sharp increase. At the time of writing this article, EUR/GBP is close to 0.8555.
Therefore, the breakdown of the local and short-term support level 0.8550 may become the first early signal to enter short positions with stops above today's high at 0.8584 with the nearest target at the support level 0.8484 (200 EMA on the 1-hour chart).
The breakdown of support levels 0.8455 (200 EMA on the daily chart), 0.8446 (200 EMA on the 4-hour chart), and 0.8430 (144 EMA on the daily chart) will finally return EUR/GBP to the bearish market zone.
In an alternative scenario, the growth of EUR/GBP will continue, and the breakdown of the local resistance level of 0.8590 will open the way for the pair toward the key long-term resistance level of 0.8625 (200 EMA on the daily chart). Growth in the zone above will mean the breakdown of the long-term bearish trend of EUR/GBP.
Support levels: 0.8550, 0.8510, 0.8484, 0.8455, 0.8446, 0.8430, 0.8400, 0.8390, 0.8370 0.8335, 0.8310, 0.8260, 0.8230, 0.8200, 0.8145
Resistance levels: 0.8585, 0.8590, 0.8600, 0.8615, 0.8625
Trading Tips
Sell Limit 0.8625, 0.8615, 0.8600. Stop Loss 0.8660
Sell Stop 0.8545. Stop-Loss 0.8595. Take-Profit 0.8510, 0.8484, 0.8455, 0.8446, 0.8430, 0.8400, 0.8390, 0.8370, 0.8335, 0.8310, 0.8260, 0.8230, 0.8200, 0.8145
Buy positions are not considered yet.
