Trade of the Day: EUR/GBP
By: Dima Chernovolov
EUR/GBP continues to fall inside the 4-hour Down Channel chart pattern which was previously identified by Autochartist. Autochartist rates the quality of this Down Channel at the 4-bar level – which reflects the slow Initial Trend (3 bars), below-average Uniformity and Clarity (4 bars). EUR/GBP is expected to fall further inside this Down Channel – in line with the earlier downward reversal from the major resistance zone shown below.
As can be seen from the daily EUR/GBP chart below – the price earlier reversed down from the key resistance area lying between the round resistance level 0,9000 (which has been reversing the pair from the end of May), upper daily Bollinger Band and the 38.2% Fibonacci retracement of the earlier downward correction from March. The proximity of this resistance area adds to the probability EUR/GBP will continue to fall inside this Down Channel.