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EURGBP Breakout Sees First Test at 0.8920

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A few days ago, I wrote about EURGBP.

The pair has been trending lower within this descending channel since it topped out earlier this year.

If you watched Tuesday’s video, you know I was waiting for a break above channel resistance near 0.8920 or bearish price action from the same area.

Notice how there is also a short-term ascending trend line that extends from the September low.

A break below that would have indicated the next leg lower.

But instead, EURGBP is in the process of breaking out above descending channel resistance.

The pair is also testing the 0.8920 horizontal level as I type this.

A close above 0.8920 today would expose higher levels next week, including 0.9015 and perhaps 0.9090.

Notice too how EURGBP has broken above channel resistance on the 4-hour chart.

I mentioned how the pair has respected this pattern on a 4-hour closing basis in Tuesday’s video post.

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Just keep in mind that this could be a false (intraday) break.

We have to respect the potential for false moves, especially from a currency as volatile as the pound.

A daily and weekly close back below the channel top would form a bearish pin bar and could signal a leg lower next week.

Regardless, I won’t be trading EURGBP until next week.

I want to see where the daily and weekly time frames close to help confirm or negate the breakout.

I also don’t want to take a new position before the weekend in case we see the pair gap on Monday.

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EURGBP descending channel on the daily time frame

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13 comments
Justin Bennett says

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Modestas says

Good afternoon Justin, the EUR / GBP is making a pin bar candle and I think that today it closes below 89,200, so next week in my opinion the pair will come down.

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    Justin Bennett says

    Thanks for sharing, but it’s far too early to tell. I’m sticking with what I wrote above.

    Reply
ali says

that is good one to keep eye on it for next week thank you sir justin ,hopefuly we can make some money next week.

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Md Rasel Ahmed says

You are right.

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Dee says

What next for XAUUSD and EURUSD next week?

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    girdharbhai padaya says

    Please send video in hindi language because I don’t know English language or give Tips what is Buy and sell

    Reply
Colin says

You make it easy to understand
Thank you

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victor says

Sir, your analysis is really working out for me
You are wonderful

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Mohamed says

Go head bro i like to your Analysis

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Benjamin says

Just wanted to confirm a bullish pin bar formation of the daily time chart for GBP/JPY. Please is this the case?

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Yusuf says

whats ur servuice charge?

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Norbert says

Do you have an idea, why EurGBP crashed yesterday ?

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