Chart Of The Day - EUR/GBP in the midst of undergoing potential short term corrective rebound
Kelvin Wong May 15, 2018 11:31 AM
EUR/GBP undergoing short-term corrective rebound above 0.8760 key short-term support.
Short-term technical outlook on EUR/GBP (Tues, 15 May)
Key technical elements
- From its Oct 2017 high of 0.9033, the EUR/GBP has been evolving in a medium-term descending range configuration with its upper limit/resistance at 0.8920 (see daily chart).
- In shorter-term, the cross pair has staged a short-term corrective rebound from its Apr 2018 swing low area of 0.8645/20 and started to evolve in a minor ascending channel (see 1 hour chart).
- The key short-term support rests at 0.8760 which is defined by the lower boundary of the aforementioned minor ascending channel, the former minor swing high areas of 09/10 May 2018 and the 61.8% Fibonacci retracement of the recent rebound from 09 May low to 14 May 2018 high.
- Both medium and short-term momentum indicators are still positive where the daily and hourly RSI oscillators have started to shape a rebound from their respective corresponding supports at the 45% and 38% levels respectively.
- The significant short-term resistance stands at 0.8890/0.8900 which is defined by the upper boundary of the minor ascending channel and a Fibonacci projection cluster (see 1 hour chart).
Key levels (1 to 3 days)
Intermediate support: 0.8790
Pivot (key support): 0.8760
Resistances: 0.8825 & 0.8890/8900
Next supports: 0.8730 & 0.8645/20
Therefore as long as the 0.8760 key short-term pivotal support holds and a break above the intermediate resistance of 0.8825 (minor descending trendline from 05 May 2018 high), the cross pair is likely to shape another potential upleg of its on-going short-term corrective rebound phase in place since 26 Apr 2018 low to target the next resistance at 0.8890/8900.
However, a break below 0.8760 shall invalidate the short-term corrective rebound scenario to resume its medium-term down move to retest the 09/10 May 2018 minor swing low area of 0.8730 follow by the Apr 2018 swing low area of 0.8645/20
Charts are from eSignal
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