Technicals: EUR/GBP readies for 100-pip drop

The daily chat below shows the pair is turning over after breaching the rising channel. The daily RSI is yet to breach the neutral level (50.00), so that could be a reason to stay on the sidelines, however, on the weekly chart, we see 4 straight candles with long upper shadows (pointing to sell on rise mentality). Last week;s candle looks like a bearish inverted hammer. It also marked a failure to hold above 0.8787 (Mar 2017 high).

Hence, it makes sense to go for shorts for a downside target of 0.8684 – 23.6% Fibo retracement of 0.6931 – 0.9225.

The best part of selling the pair here is that the stop level – 0.8787 is very close.






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