Home Technical Analysis EURGBP: Early results of UK elections damaged double bottom
EURGBP: Early results of UK elections  damaged double bottom

EURGBP: Early results of UK elections damaged double bottom

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The EURGBP pair has collapsed after flirting with the psychological level of 0.7500 following the advance the British pound made against majors yesterday after declaring the early results of parliamentary elections.

Back to technical, we can believe that the upper line of Bollinger bands held as a strong resistance since it intersected with the psychological level of 0.7500.

eurgbp-fxcomment-08-05-2015

Yesterday’s collapse has created a long black candlestick pattern that couldn’t be ignored, as it engulfed 5 days of advance and took the royal pair below the breached neckline of the double bottom we discussed earlier.

RSI14 also has been taken towards the momentum support zone, while Vortex-trend indicator- is showing some kind of trend weakness.

Accordingly, we will continue to watch out the price behavior of the EURGBP pair, aiming to join bears below the middle line of Bollinger bands.

We suggest placing a sell stop order below the initial support of 0.7220 with targets at 0.7090 and stop loss at 0.7380- just a few pips above 0.7360 resistance- but to limit our risk ahead of NFP data release, we can use just 1% of the available quantity.

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Amir El-Araby Co-Founder & Chief Global Strategist at FxComment.com, with 17 years’ experience in the technical analysis studies for FOREX, Commodities and Indices. Amir El-Araby worked as a mentor for many companies and institutes, where he presented new methods for trading in the financial market. Amir is a member of ESTA (Egyptian Society of Technical Analysts). Amir is also the official partner of Harmonic Trader (Mr Scott Carney) and the official instructor of harmonic trader association for Arab countries.

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