EUR/GBP produced a bearish engulfing candle on last Friday in the daily chart. The candle is produced right at the level, where the price had a rejection earlier. Today’s price action has been bearish in the major intraday charts. If the price makes a breakout at Friday’s lowest low, the sellers may drive the price towards the South further. Let us now have a look at three major charts.
Chart 1 EUR/GBP Daily Chart
The chart shows that last Friday’s candle came out as a bearish engulfing candle. The level of 0.90200 has been working as the level of resistance, where the price had a rejection earlier as well. Thus, a breakout at the last swing low at 0.88800 will be considered as a neckline breakout. This may drive the price towards the South with good bearish momentum. The price may find its next support around 0.87000.
Chart 2 EUR/GBP H4 Chart
The chart shows that the price has a bounce at 0.88860 several times. As of writing, the pair is trading around the level. The sellers may go short below the level and drive the price towards the downside. The price may find its next support around 0.87650. On the other hand, if the level produces a bullish reversal candle, the price may head towards the North with a sluggish pace. The price may find its next resistance around 0.89550.
Chart 3 EUR/GBP H1 Chart
The chart shows that the price after being very bearish had a bounce at the level of 0.88860 and made a bullish move. The level of 0.89170 has been working as the level of resistance. This is a Fibonacci level of 78.6 of the last bearish move. Thus, it has created a bearish momentum. A breakout at the level of 0.88860 may push the price towards the South with good momentum. However, the sellers may wait for the price to make an upside correction and a bearish reversal candle to go short in the pair. The price may find its next support around 0.88115. On the contrary, if the chart produces a bullish reversal candle around the level of 0.88860, the price may get choppy within 0.88860-0.89170.
The daily and the H1 chart look good for the sellers. However, the H4 chart is slightly bearish biased, but the level of support looks strong. The sellers must wait for a bearish breakout. Considering these three charts, the pair may end up producing another daily bearish candle today.