Last night we opened a forex signal in EUR/GBP. We opened two forex signals in this pair actually, we bought EUR/GBP at the 100 SMA on the H4 chart, which stands at the same place as the 200 SMA on the H1 forex chart.
That signal went pretty well as it hit take profit after a while. The buy signal was a bit of a gamble since GBP had jumped around 150 pips after Carney´s hawkish comments, which sent EUR/GBP diving 100 pips lower.
But we analyzed the charts, followed the price action and took our chances, so we got our pips.
The 100 SMA seems unbreakable
After EUR/USD retraced 40 pips higher, we decided to reverse the trade. We opened a sell forex signal here which nearly hit take profit a while ago.
We decided to take this forex trade because Carney´s comments put GBP in a very bullish position all of a sudden.
The uptrend in EUR/GBP hasn´t changed, but the chances are that it might. If not, at least a decent pullback looks very likely.
As we said in the previous forex update, the Euro is in a bullish phase as well, but as of yesterday, GBP seems to be in a slightly better position.
Besides the fundamental factors, technically, the downside looks more favourable in EUR/GBP, particularly for short term traders. You see that the 100 SMA (green) has been providing solid resistance since yesterday and it was this moving average the main reason we opened our forex signal.
It´s doing its job pretty well and we nearly reached TP an hour ago, but not quite. Now, the signal remains open but I still see the downside as more favourable.
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