Hi Traders! EURGBP forecast and technical analysis post is here. We do our analysis on the MetaTrader4 platform (MT4), some very interesting, useful tips and hacks about the MT4 platform could be found here. As we do in every technical analysis post we are going to perform the multi-timeframe technical analysis on this pair in order to find possible trading opportunities. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! Let’s start our analysis now from the highest timeframe which will be the daily chart here.
EURGBP D1(Daily) Chart Analysis – Key Support Zone, Bullish Divergence, Parabolic Sar
On the daily chart, the price which was moving lower has reached a strong support zone, respected it and is bouncing higher from this zone. In addition to this, we have the 0.85000 psychological level coinciding in the same zone which makes this area a key support zone for us. Also, we have a bullish divergence that has formed between the first low that has formed at 0.85395 and the second low that has formed at 0.84499 based on the MACD indicator which we may consider as evidence of bullish pressure. In addition to this, based on the Parabolic Sar we could see that the dots are below the price which we may consider as yet another evidence of bullish pressure. Also, currently there are no signs opposing this bullish view. So everything looks good here for the bulls and we may now move down to lower timeframe and look for evidences supporting this bullish view.
EURGBP H4(4 Hours) Chart Analysis – Bullish Trend Pattern, Bullish Convergence, Downtrend Line Breakout, Two Strong Support Zones
On the H4 chart, the price which is moving higher has created a bullish trend pattern in the form of three higher highs, higher lows, we may consider this as evidence of bullish pressure. Generally, after a bullish trend pattern, we may expect corrections and then potential continuation higher. Currently it looks like the correction has happened in the form of double wave down. Also, we have a bullish divergence that has formed between the first low that has formed at 0.85102 and the second low that has formed at 0.85006 based on the MACD indicator. Then the price moved higher and broke above the last high at 0.85624 creating higher highs, thus forming a classical setup of bullish divergence followed by bullish convergence. Hence as per the book scenario, after a bullish convergence, we may look for corrections to happen and then further continuation to the upside. In addition to this, we also had a breakout of the most recent downtrend line which we may consider as yet another evidence of bullish pressure. Currently it looks like a correction is happening, until both the strong support zones shown in the image below holds my view remains bullish here and I expect the price to move higher further.
(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
Technical Analysis & Forecast Summary
EURGBP D1(Daily) Chart Analysis
- Key Support Zone, Bullish Divergence, Parabolic Sar
EURGBP H4(4 Hours) Chart Analysis
- Bullish Trend Pattern, Bullish Convergence, Downtrend Line Breakout, Two Strong Support Zones
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
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Arvinth Akash
Traders Academy Club Team
