Currency
by Seth Parker on March 16, 2018

EURGBP Analysis – That setup was just perfect!

It would be marvellous if everything was just that easy on the FX market. EURGBP just had a perfect bearish price action setup and those traders who read that right are now full short positions on this pair.

Was it really that good?

Yes. The price made a head and shoulders pattern above the horizontal resistance on the 0.8910 (blue). The price went below this level, which in the same time was a neckline of this formation. Price getting there was a signal for a false breakout, which was another bearish factor here. What is more, we came back below the mid-term down trendline (red), which additionally killed rest of the demand. The last punch we made today. The price broke the mid-term up trendline (green), which in theory, wiped out all the buying potential on this instrument.

EURGBP Chart

Currently, the sentiment is 100% negative. It is hard to estimate the potential target for this movement but 0.87 (orange) seems quite reasonable. The potential risk to reward ratio for this trade is still very tempting.

By Seth Parker

Seth is a professional trader with over 10 years of experience. He specializes in the technical analysis. His main focus is on the pure Price Action. In his trading, Seth used the trends, supports and resistances and technical formations. Always, the most important thing in his strategy is the money management. Seth reached a proficiency in trading and for the past three years is doing that for a living enjoying the sun and lovely beaches of the Spanish coast.

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