EUR/GBP Candlesticks and Ichimoku Analysis
|
Last Candlesticks pattern |
Time of formation |
Trend bias |
| Weekly |
Evening star |
28 Dec 2008 |
Sideways |
| Daily |
N/A |
N/A |
Sideways |
Although euro rose to 0.9491 last week in line with our expectation, the pair then retreated from there after faltering below indicated resistance level at 0.9520, suggesting initial consolidation would take place this week, however, euro's downside is likely to be limited to 0.9145/50 and renewed buying interest shall emerge around 0.9075/80 (current level of Tenkan-Sen), bring another test of 0.9520 resistsance. Looking ahead, if euro is able to clear this level (better to be a weekly close above), it would provide confirmation that the medium term uptrend has resumed for a re-test of recent high of 0.9805, then towards 0.9900 but reckon psychological 1.0000 resistance would remain intact.
On the downside, only below 0.8749 (current level of Kijun-Sen) would defer this bullish view and prolong consolidation below 0.9805 and bring another corrective fall to 0.8637, then 0.8500. However, downside should be limited to 0.8225 chart support and the single currency shall hold well above 0.8000, where the upper limit of Ichimoku cloud is located.
On the daily chart, the pullback from 0.9491 looks set to test the Tenkan-Sen, which is currently locating at 0.9317 and although weakness towards 0.9250 cannot be ruled out, the circled 'hammer' like candle stick suggests the support at 0.9145/50 is near term pivotal level and should remain intact, bring another rally later. Above 0.9491 resistance would bring test of indicated upside key resistance at 0.9520, a daily close above this level would confirm the correction from last year's high at 0.9805 has indeed ended at 0.8637, then headway to 0.9650 would follow but resistance at 0.9805 shall hold on first testing.
On the downside, only below said 0.9145/50 support would dampen this upside bias and weakness to 0.9100 (Kijun-Sen as well as upper limit of Ichimoku cloud) would be seen next, however, downside should be limited to 0.8970 (lower limit of Ichimoku cloud) and 0.8850/55 should contain pullback and price should hold well above 0.8728 support.
|
