EUR/GBP bearish momentum to resume: 1:2 rr potential

October 06, 2023 07:43 AM PDT | By Invezz

EUR/GBP bearish momentum to resume: 1:2 rr potential — Image source: Invezz

EUR/GBP trading strategy

Sell EUR/GBP
Entry price: 0.8620 – 0.0875 area
Stop loss: 0.88
Leverage: 3x
Take profit 1: 0.8550
Take profit 2: 0.8450
Timeframe: 2-3 weeks
Risk-reward ratio: 1:2

EUR/GBP chart & technical analysis

EUR/GBP is a cross pair reflecting the differences between the euro area and the UK economies. Also, it reflects the differences between the two majors it represents – EUR/USD and GBP/USD.

In September, the cross met resistance again in the 0.87 area. It looks like it forms a horizontal continuation pattern, after which the market should continue in the same direction as before – lower.

Euro fundamentals

I’m looking for euro fundamentals to weigh more on the cross than the UK ones. European growth is weak, if not insignificant, and Q4 perspectives are not great.

EUR to GBP trade idea takeaways

The risk-reward ratio is an attractive one
I’m expecting the decline to gain traction once below 0.86
Don’t insist on a decline of more than 0.84
A move above 0.8850 would invalidate this scenario

The post EUR/GBP bearish momentum to resume: 1:2 rr potential appeared first on Invezz.

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