EUR/GBP Price Forecast: Breakdown from channel could follow-through lower

EUR/GBP has broken out of a channel and closed below the lower channel line.
It will probably continue falling to bearish targets.

Joaquin Monfort FXStreet

EUR/GBP has broken out of the underside of a shallow rising channel. It has closed below the channel line suggesting the breakout will probably follow-through and go lower, possibly to a target at 0.8406.

EUR/GBP Daily Chart

It is possible the bearish bias evident during the steep fall in August is reaserting itself. A break below 0.8419 would provide confirmation of further downside toward a target at 0.8406, the 0.618 Fib extension of the height of the rising channel lower. Below that it is possible prices could fall to support at 0.8385.

Alternatively, it is still possible – though unlikely – that the break proves false. If so, price could recover back inside the shallow rising channel and extend, with circa 0.8460 as a possible upside target thereafter.

(This story was corrected on September 17 at 11:15 GMT as the content refered to a different currency pair to the title.)

Author

Joaquin Monfort

FXStreet

Joaquin Monfort is a financial writer and analyst with over 10 years experience writing about financial markets and alt data. He holds a degree in Anthropology from London University and a Diploma in Technical analysis.

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