Double Top Confirmed as EURGBP Slides Lower

Posted On 13 Apr 2015

As a follow up to yesterday’s commentary, EURGBP has now closed below the neckline at .7225 on a 4 hour basis. This confirms the double top between March and April.

From here we can watch for a retest of the level as new resistance. Potential support areas to the downside include .7154 and the 2015 low at .7012.

Of course traders who are more risk-averse can wait for a daily close below .7225 before considering an entry. This would provide further confirmation of the double top pattern and thus an increased likelihood that we will see further losses in the days ahead.

In terms of upcoming event risk, the docket is fairly light over the next 24 hours. However the one event traders should keep an eye on is tomorrow’s CPI reading for GBP, which is scheduled for 4:30am EST.

Remember to keep your risk to reward ratio favorable at 2R or better on this and every trade you take. In the case of EURGBP, it should be fairly easy to achieve this minimum R-multiple.

About the Author

Justin Bennett is a full-time Forex trader and Owner of Daily Price Action. His Forex trading career began in 2007 and has followed a path similar to many traders. He tried nearly every indicator known to man for the first 3 years with little success. It wasn't until he started using raw price action in 2010 that he became consistently profitable. Since that time, he has been developing strategies and techniques that can be easily duplicated by other traders. Justin can also be found on Google+, Twitter and Facebook