The EUR/GBP’s double-bottom-confirming price action was short-lived as it ended last Friday session (7/27) with a sharp rejection at the 0.7870 pivot. The 4H chart shows that the bearish momentum in the short to medium term is preserved as the RSI failed to break above 60 after it had been able to dip below 30.
It is starting this week sliding further during the 7/30 session, accelerating a bit as we start the US session. The 4H chart shows the pair cracking 0.78 and attacking the consolidation support trendline threatening bearish continuation.
The first target is the 0.7750-0.7760 low. A break below that, with the RSI falling below 40 exposes the next key support.
Previous FXTimes updates have been noting the 0.77 area as a key support area going back to the 2008 consolidation lows. If the market does push through 0.7750, and slow down above 0.77, we might consider a more significant correction than the one we had last week.
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.