EURGBP forms double top with peak 1 at 0.8852, peak 2 at 0.8787 and with the neckline at 0.8417 levels.
Consequently, upon this bearish pattern, the bears have managed to break below this neckline level, which is a severe caution for aggressive bulls.
More dips seem to be likely as the current prices slid below DMAs, EMAs and on bearish DMA crossover.
Most importantly, this bearish indication is backed by the momentum as well as trend indicators (see daily chart.
Moreover, Shooting star pattern is also traced out at 0.8581 and 0.8488 levels on monthly terms.
As a result, current prices on broader perspectives have gone below 7EMAs on monthly terms, now attempting break below strong support at 0.8353 levels.
We could now foresee the weakness in this pair as the back-to-back shooting star patterns occurred after bearish candle with the big real body (refer monthly terms), this bearish stance is also substantiated by momentum oscillators on monthly terms, any break below 0.8353 can drag upto 0.8202 levels.
RSI on both timeframes evidence downward convergence with the price slumps that signals strength in declining trend.
While stochastic curves have halted in oversold territory but no convincing %K crossover on daily terms, for now, it appears to be indecisive but bearish bias on monthly terms.
MACD – this lagging indicator on daily charts has just entered into bearish trajectory and evidenced bearish crossover that signals the bearish trend to prolong in further.
Trading tips:
On speculative as well as hedging grounds, initiate shorts in futures contracts of mid-month tenors to arrest the potential slumps upto 0.8202 levels or even more than that, but keep a strict stop loss of 0.8515 levels.
