EURGBP – Bias flips to the downside

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Monthly: Since posting large nett losses in September 2017 (-395 pips) the cross has moved sideways. We can note spikes for the last 10 months highlighting indecision. The RSI (Relative Strength Index) is close to 50 (mid-point) highlighting we are non-trending. A large wedge formation offers a long-term bearish bias. A break of support at 0.8740, and the measured move target is 0.8300

Weekly:  The corrective rally stalled outside the trend line resistance (0.9000) and close to the 61.8% pullback level of 0.9045 (from 0.9307-0.8619). Virtually all last week’s original gains were overturned.

Daily: Price action looks to have completed a bullish 5-wave (Elliott Wave) formation. Trend of higher lows is located at 0.8815

Intraday 4-hours: The medium-term outlook now turns bearish. Bespoke support is located at 0.8860. A corrective bounce from this area would highlight a 61.8% pullback level at 0.8968, close to the previous swing high. We look to sell into future rallies


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