EUR/GBP Upside Breakout of the Descending Wedge Pattern

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Updated: 20 October 2020

Hello traders! Since September EUR/GBP has been declining steadily while forming a descending wedge pattern. But today, finally price broke above the downtrend trendline, suggesting the beginning of the upside move.

After the breakout EUR/GBP corrected down slightly where it rejected the 200 Exponential Moving Average as well as the downtrend trendline. This could have been the very beginning of a fast and strong uptrend. Right now EUR/GBP is expected to start rising towards the 0.9243 resistance which is confirmed by two Fibonacci retracement levels, 50% and 627.2% as per the chart below.

This means that there is over 100 pips growth potential which could be accomplished throughout this week.  As long as the price remains above 0.9079, the uptrend will be imminent. However, 1h and/or 4h break and close below the 0.9079 support, will invalidate bullish outlook and EUR/GBP might continue range trading or even initiate a downtrend in the long run.

Bias: Strongly bullish while above 0.9079

Potential Support Zone: 0.9080 – 0.9105

Potential Targets: 0.9243

Have a profitable trading!