GBPEUR, Forming Possible Reversal With Opportunity Incoming!
Updated
Hello Traders Investors And Community, welcome to this analysis where we are looking at GBPEUR 4-hour timeframe perspective, the recent events, the current formation, what to expect and how to handle upcoming price-action in the right appropriate manner. GBPEUR was in a protracted downtrend where it stopped recently at the 1.09 level and now forming somewhat of a consolidation, the big question most often in such consolidations is if it will continue further to the downside or a substantial reversal building that can reverse the price and establish a new paradigm. In this consolidation, I detected some meaningful signals which will determine the further outcomes of this pair till then there are some importances and signs which the pair has to fulfill in order to show the right confirmation and trading setup when considering to enter here.
Looking at my chart you can watch that the strong consolidation range building up here is actually a possible big head and shoulder formation marked in blue with the consolidation below the 300- and 40-EMA currently holding on which can indicate a sign of strengthening before the final breakout happens, furthermore the pair is building a parallel channel here which is important to hold in order to show a breakout and overall validation of the head and shoulder formation, when GBPEUR falls below the lower boundary of this channel there is a strong invalidation range in which the pair will show continued bearish pressure to the downside, therefore, it is important to bounce at the lower boundary as it is shown in my chart.
When the pair manages to stabilize at or above the lower boundary and finally break out the neckline of the head and shoulder formation with a volatile bullish move this will be the confirmation of the formation and higher upside targets will be activated. This mechanism can be traded either aggressively with immediate entry or conservative with entry after the confirmation has taken place. Although the immediate entry is also possible here the conservative waiting on confirmation will be much smarter here as it is also minimizing the risk. Minimum target after the confirmation has taken place will be the upper boundary of the channel, when these targets reached it needs to be elevated what GBPEUR is doing further in the range.
In this manner, thank you for watching, support for more market insight, all the best!
"The past as the future is indefinite and exists only as a spectrum of possibilities."
Information provided is only educational and should not be used to take action in the market.
Looking at my chart you can watch that the strong consolidation range building up here is actually a possible big head and shoulder formation marked in blue with the consolidation below the 300- and 40-EMA currently holding on which can indicate a sign of strengthening before the final breakout happens, furthermore the pair is building a parallel channel here which is important to hold in order to show a breakout and overall validation of the head and shoulder formation, when GBPEUR falls below the lower boundary of this channel there is a strong invalidation range in which the pair will show continued bearish pressure to the downside, therefore, it is important to bounce at the lower boundary as it is shown in my chart.
When the pair manages to stabilize at or above the lower boundary and finally break out the neckline of the head and shoulder formation with a volatile bullish move this will be the confirmation of the formation and higher upside targets will be activated. This mechanism can be traded either aggressively with immediate entry or conservative with entry after the confirmation has taken place. Although the immediate entry is also possible here the conservative waiting on confirmation will be much smarter here as it is also minimizing the risk. Minimum target after the confirmation has taken place will be the upper boundary of the channel, when these targets reached it needs to be elevated what GBPEUR is doing further in the range.
In this manner, thank you for watching, support for more market insight, all the best!
"The past as the future is indefinite and exists only as a spectrum of possibilities."
Information provided is only educational and should not be used to take action in the market.
Note
ANALYSIS UPDATE: GBPEUR rightly continued with the breakout-setup to emerge with the final volatility increase breaking above the trendline.GBPEUR since completing the finalized breakout setup emerged with the projected long setup to enter all of the target zones within the schedule.
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