EURGBP 2019 Recap

With the EUR/GBP between well established resistance ranges there is a high level of instability and volatility in the market. With the growing threat of a Brexit imminent the EUR/GBP finds itself in a particularly vulnerable position.

Starting 2019 off the EUR/GBP maintained a hallway of sideways consolidation between December 7, 2018 and January 14, 2019 testing resistance level 0.90422. The initial market reaction is to move and retest a previously established resistance level at 0.86510. With low volatility and high insecurity the EUR/GBP maintains another hallway of sideways consolidation between resistance level 0.84866 and resistance level 0.86510 from February 22, 2019 to May 6, 2019. 

With the region in a current state of election there is a clear upward trend with low volatility that is being established prior to a final pullback on July 25, 2019 to retest resistance level 0.88972 before finding the years highest high on August 9, 2019. With no real sustainability at this particular level the EUR/GBP transitioned into a downward trend to retest previous resistance levels and areas of sideways consolidation. 

A final retest of resistance level 0.90422 on October 10, 2019 was followed by a volatile downward push finale ending on October 18, 2019 testing resistance level 0.86510. From October 21, 2019 to December 4, 2019 the EUR/GBP experienced low volatility and an inability to maintain above established resistance level 0.84866. Shown in diagram A

Current EUR/GBP Projections

The EUR/GBP is currently in a resistance range that is outside of the years established prior resistance levels. The only previous time the EUR/GBP has tested or dipped below resistance level 0.84866 was during a stint of sideways consolidation lasting from February 22, 2019 to May 6, 2019. With clear indication that the EUR/GBP is currently in a downward trend the EUR/GBP is expected to retest previously lower resistance levels prior to 2019.

With the next lowest resistance level established at 0.82772 and tested on December 13, 2019, the EUR/GBP is expected to test and retest resistance level 0.84866. If the EUR/GBP is unable to maintain above resistance level 0.84866 a downward trend will ensues. With the high volatility and instability surrounding the Brexit situation the EUR/GBP does not have a well defined future leading into 2020.

*Charts are created with TradingView, our partner in charting.
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Written by Nenad Jordanoski, Futures Trader and Technical Analyst.
Email: nj@thetrade.academy
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