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EURGBP Consolidating Below Ichimoku


Nov.29.2016

EURGBP Consolidating Below Ichimoku

It's been tough times for EURGBP consolidating below Ichimoku cloud. Both the Euro and the British Pound are under pressure. Are there any trading opportunities coming up for the pair? Read on for an IDDA approach to strategy development.

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Technical Analysis |EURGBP Consolidating Below Ichimoku

Daily Chart: The EUR/GBP pair broke below an upward moving daily Ichimoku cloud mid-November after also breaking below the long-term 23% Fibonacci retracement level at 0.8680. It is now consolidating somewhere in between.The support set at 38% Fibonacci at 0.8350. The Tenkan line has broken below the Kijun. However, the Chiko span has yet to break below the cloud.

EURGBP Consolidating Below Ichimoku - Daily Chart Technical Analysis EURGBP Consolidating Below Ichimoku - Daily Chart Technical Analysis

 

 

Monthly Chart:  On the monthly chart the pair has formed a clear bullish engulfing. However, it remains above the downward Ichimoku cloud. The upper band of the cloud could start acting as a sliding support in the coming months.

EURGBP Consolidating Below Ichimoku - Monthly Chart Technical Analysis EURGBP Consolidating Below Ichimoku - Monthly Chart Technical Analysis

Fundamentals | EURGBP Consolidating Below Ichimoku

The current global delimma is that Brexit and Trump’s victory are signs that populist, anti-establishment movements are on the rise. This is bad for Mr. Euro, since the Euro Zone has to deal with a potential Italeave and Frexit. But at the same time, it’s good for Mr. British Pound. Because focus is shifting to uncertainty in continental Europe. As a result, the price action of pound and euro pairs have become somewhat inverse. At the end of the day, it is now only the matter of which one of these naughty boys will get into more political/ economical mess.

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What went down so far this week ...

The BOE released its Money and Credit report for the October period on Tuesday. The number of mortgage approvals came is better than expected. The reading implies that the U.K. housing market is still relatively healthy, despite the Brexit referendum. — yay for Mr. Pound.

Coming up on the economic calendar...

The volatile markets have been speculating Wednesday’s  OPEC meetings, as well as, believe it or not,the  US President-elect Donald Trump’s Twitter account. Furthermore on Wednesday Bank of England Publishes Financial Stability Report will be out at 7 AM GMT. Later German Unemployment Change (NOV) will be out at 8:55 AM. At 12:30 PM ECB's Mario Draghi Speaks in Madrid to potentially shake the EUR crosses further.

 

Market Sentiment |EURGBP Consolidating Below Ichimoku

Both Mr. Euro and Mr. British Pound have been under serious mixed market sentiment in the past few days. The bulls and bears are undecided and only an ultra-cool catalyst could identify a winner ... I wonder what that catalyst could be ...

 

Trading Strategy | EURGBP Consolidating Below Ichimoku

Putting the technical, fundamental and sentimental points of the IDDA approach together, we could consider a short term trading strategy for now. Please visit out Premium Facebook Group for detailed strategy.

As always, when in doubt, book a private session with me to get your portfolio on track.

 

Here are Invest Diva's calculations for important EUR/GBP approximate levels to keep an eye on:

Support Levels Turning Point Resistance Levels
0.8088 0.86 0.8773
0.8350 0.8465 1.09

 

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Kiana 喜愛成
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