Patterns: EUR/GBP GBP/CHF
|EUR/GBP 1H Chart: Pair faces strong support
The Euro has depreciated substantially against the Pound Sterling since early March. This bearish movement was stranded in a descending channel. The pair was consolidating near the senior channel for a brief period of time last week prior to breaching the junior pattern and surging up to the weekly R1 at 0.8720.
Even though the medium-term pattern was breached yesterday, technical indicators nevertheless remain bearish for the following day and week. A possible downside target in this case is the senior channel at 0.86. In order to confirm this scenario, the Euro still has to overcome the combined support of the 200-, 55– and 100-hour SMAs and the weekly PP circa 0.8680.
On the other hand, the rate could rebound from the breached channel and the 200-hour SMA and surge even higher within this week. A strong resistance that could halt this surge is provided by the 50.0% Fibonacci retracement and the monthly PP circa 0.88.
GBP/CHF 1H Chart: Bullish sentiment weakens
Strong upside risks have guided the GBP/CHF currency pair for the last two months. This movement began early in March when the Sterling reversed from the bottom boundary of the senior channel. It is now located near the other channel line.
As apparent on the chart, the rate has not still fully reached this line which is located at 1.39, as it was disrupted by the strong plunge mid-Wednesday. A subsequent advance did not occur due to the resistance of the 55-hour SMA.
Some slight recovery is still expected to occur within the remaining part of the week; however, the senior channel might still remain intact.
Meanwhile, it is likely that the Pound edges lower in the medium term and breaches the prevailing ascending channel, the 200-hour SMA, the weekly R1 and the monthly R2 circa 1.3650. The following target is the 1.3550 area.
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