EUR/GBP Targets 0.7850

Day: Last week, I started noticing topping action for the EUR/GBP below 0.8400. Refer to the 9.3.2010 update on EUR/GBP. The market rallied pass this “topping action” but eventually rejected a rally above 0.8400. This was an important resistance and the market has come down for 2 sessions so far if the US session does not reverse the situation in its trading session.

The RSI confirms that the bullish attempt was weak in the intermediate term and the mode remains bearish.

The day chart shows the minor penetration of declining trendline but respect of the 0.84 powerline. The target projection suggested by a negative reversal with the RSI is to 0.7850, which didn’t change from last week, but since the market rallied to 0.84, the smaller degree swing projection goes to 0.80. That is the more conservative target, or may be an area to anticipate an emergency exit.

4H: The 0.8200/0.8190 area is an important area to break for the bearish outlook to have a better chance. This area is the middle of the triangle pattern. Combined with the RSI dipping below 30, the market is showing that the short-term bearish attempt so far this week can carry over.

Another pivot I should mention is the low at 0.8150. So basically, if the market breaks below 0.820, it is likely to at least go to 0.8150 and should go to 0.80. If 0.80 breaks, the 0.7850 level can be the target.