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Elliott wave Analysis: EURGBP Can Be at Resistance; More Weakness in View

Hello traders, and welcome to our new article regarding the EURGBP. Today we will focus on the pairs’ structure and its overall direction. Let’s dig in!

On the 4h chart of EURGBP we can see that the price is unfolding in a bigger, bearish movement, which is, as we look closely, in five waves, which also means that a new bearish change in trend is here. That said, the current temporary low is at 0.8667 level, and the following three-wave rise can only be a temporary pause within a downtrend, that can be underway since early March.

This correction, labelled as a-b-c can be slowly ending, if we consider that a correction needs only three-waves for a completion and that we also see the price trading near some interesting resistance and reversal zones. We are talking about the Fibonacci ratios of 38.2, which can slow the current bulls down and also the former swing high of wave iv) at the 0.8799 level, which usually reacts as a reversal for the upcoming correction.

Now, if the price trades as expected, then a new turn lower can be just around the corner for the EURGBP pair, however, we need an impulsive drop down to confirm our expected bearish look.

EURGBP, 4h

Gregor Horvat

Gregor Horvat

Grega Horvat Grega is based in Slovenia and has been involved in markets since 2003. He is the owner of Ew-Forecast, but before that he was working for Capital Forex Group and TheLFB.com. His feature articles have been published on FXstreet.com, Thestreet.com, Action forex, Forex TV, Istockanalyst, ForexFactory, Fxtraders.eu, Insidefutures.com, etc. He recently won the award on FXStreet.com for Best Forex Analysis in 2016. At Ew-forecast he helps clients and educates them about the Elliott wave principle and how to label and track unfolding patterns in real time. His approach to the markets is mainly technical. He uses a lot of different methods when analyzing the markets such as candlestick patterns, MA, technical indicators etc. His specialty, however, is Elliott Wave Theory which could be very helpful especially if you know how to use it in combination with other tools/indicators. EW-Forecast To be involved in the market effectively, you need the right guidance and resources, and our team can help you to achieve that. Our team is providing advanced informations about Elliott Wave theory in real time. The Elliott Wave Principle gives you a method for identifying the behavior of the markets and at what points the market is most likely to turn. We help new traders who are interested in Elliott Wave theory to understand it correctly. We are doing our best to explain our views as simple as possible with educational goal, because knowledge itself is power!