Based on technical analysis the bearish trend is present in EUR/GBP currency pair, 4 hours time frame based on EUR/GBP Elliott Wave Weekly Forecast. As I have forecasted few hours ago, the price of EUR/GBP pair is going to drop now to prints a Bearish Impulse Elliott wave pattern and traders should look for a sell trade. So, all those Forex traders who have followed my Elliott wave analysis have made the right decision as price has descended.
Strong key resistance level is present at 0.8839 price area which is the termination point of Bullish corrective wave iv leg. In my judgment, price action in EUR/GBP currency pair is now going to drop more to prints a bearish impulse wave v leg. So, market is going to remain bearish on a short term basis. Next, expects a short term bottom in price action as well. Based on Elliott wave forecast, the current Bearish trend is part of a Bearish Impulse Elliott Wave pattern, wave 3 leg in higher time frame.
Currently, bearish impulse Elliott wave pattern wave v looks in-complete. So, a good idea is to look for a possible sell trading chance to join the down trend around 0.8597 price area. However; if the price of EUR/GBP currency pair breaks above 0.8839 vital resistance level then down trend is going to end. In such a market scenario, it would be best not to trade the Forex market and re-do the EUR/GBP Elliott wave analysis in four hours chart.
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Now, at this point; I must acknowledge that the trend is also bearish in higher time frame of EUR/GBP currency pair.
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Below is the daily chart of EUR/GBP pair with my Elliott wave forecast which shows us a big picture and a well started bearish trend as well.
To me; price action has printed Bearish Double Zig Zag corrective wave 2 leg. Now, price action is falling down to complete the bearish impulse wave 3 pattern. So, now market is moving down on a long term basis to complete the bearish impulse wave 3 leg. The bearish impulse wave 3 leg is the not the last and final decline and price is going to prints a short term bottom after that. Within the Bearish Impulse Elliott wave pattern, all sub-waves must sub-divides into 5, 3, 5 3 and 5 waves pattern.
The following Elliott Wave Bearish Impulse pattern diagram shows us a completed Bearish Impulse Wave pattern within the frame work of Elliott wave principle.
The Bearish Impulse Wave pattern of the Elliott wave principle shows that how price action does not moves in a straight line fashion but in a series of lower swing highs and lower swing lows. Bearish Impulse Elliott wave pattern in a down trending market could be seen inside the above image. The figure shows what a Bearish Impulse Elliott wave pattern looks like. If a trader knows what a Bearish Impulse Wave pattern looks like, then it would become much easy for a currency trader to actually analyze the Forex charts and make a trading decision as well.
A Bearish Impulse Wave consists of total five waves. Three bearish leg in the favour of down trend and two bullish corrective Elliott wave patterns, against the down market trend. We use numbers to label impulse waves 1, 2, 3, 4 and 5 and inside wave 2 and 4, we use English alphabets to label corrective wave structures. Please take a note that Bearish Impulse Wave pattern is a motive Elliott wave pattern which appears at a trending market environment and moves in the favour of larger down market trend.
Based on my EUR/GBP technical analysis using Elliott Wave forecast in daily chart, we have got a in-complete Bearish impulse wave 3 leg and price action is now going to drop more to completes bearish wave 3 impulse leg. However; it is possible if price breaks above blue colour resistance line then bearish forecast will become in-valid. Now, price action is probably going to move sideways and then fall down more to prints a bearish impulse wave 3 leg. To me; in four hours chart of EUR/GBP currency pair the bearish leg which is part of a higher degree wave 3 in daily chart is just a bearish leg in a down trend leg as mentioned above as wave 3 impulse wave pattern inside a daily price chart.
Strong key resistance level is present at 0.9110 price area in EUR/GBP daily chart. So, I expect market to first move sideways for next coming trading days and then may be starts the decline. So, in my opinion market is going to remain bearish overall and on a medium to long term basis, expects a bearish leg in market. Next, market is probably going to resume the down trend after that in EUR/GBP currency pair, in daily chart.
Now, when an existing Bearish Elliott Wave Weekly Forecast in EUR/GBP is going to fail?
Well, the forecast is good for about next two weeks time and price should stays below 0.9110 resistance area in daily time frame to keep the down trend alive. A clear bullish break out in price action above 0.9110 resistance area will end the down trend and bearish Elliott Wave Weekly Forecast; in such a market scenario, it would be best not to trade the market and re-analyze EUR/GBP daily chart.
Based on EUR/GBP Elliott Wave Weekly analysis the trend is down in daily chart and a good idea is to look for a sell trade around 0.8530 price area, as price action is going to drop more towards 0.8251 but a clear bullish break out in price action above 0.9110 vital resistance area will end the down trend. On a medium term basis, it is a bearish trend in EUR/GBP 4 hours time frame and a good idea is to take a sell trade around 0.8597 price level and price is probably going to drop lower towards 0.8514 price level. However; if the price of EUR/GBP currency pair breaks above; 0.8839 vital resistance level then bearish trend is going to end. We recommend trading with these top-rated brokers when using our signals/analyses/forecasts as they handle your trades quicker and more efficiently with very low spreads and most of them have high trade execution rate.
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