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EURGBP - SHORT: Solid Risk/Reward Set-up

The confluence of bearish technical factors present on multiple time-frames creates an excellent risk/reward opportunity in the EURGBP (Euro vs. Pound).

Here are the details:

1. Long-term trend-line extending back to the end of 2008 touches off on peaks formed  in 10/2009, 03/2010, and now.

2. Daily 14-period RSI has hovered above overbought for an extended period of time, and rolling over now as price stalls at trend-line resistance.

3. Head-and-shoulders pattern developing on the 240 minute chart.

EURGBP LONG TERM     Eurgbp 240

The projected price target, based off the range of the H&S pattern, is 0.8550-0.8600, to occur sometime in the next week.  An entry here at 0.8750 with a stop above the right shoulder pivot of 0.8823 provides this trade with a risk to reward ratio of better than 1:2.



Disclosure: "No Positions"