By: Dima Chernovolov
EUR/GBP continues to fall inside the hourly Falling Wedge chart pattern which was previously identified by Autochartist. Autochartist measures the quality of this Falling Wedge at the 5-bar level – which is the result of the average Initial Trend, Uniformity and Clarity (all rated at the 5 bar level). EUR/GBP is expected to fall further inside this chart pattern – in line with the earlier breakout of the key support zone shown below.
As can be seen from the daily EUR/GBP chart below – the price earlier broke through the support area located between the key support level 0.9000 (which reversed the price earlier this month) and the 38.2% Fibonacci correction of the previous sharp upward impulse from February. This price area is acting as the resistance zone after it was broken. The proximity of this resistance zone increases the probability EUR/GBP will continue to fall inside this Falling Wedge.