EURGBP Bullish Structure Analysis – Channel Breakout + Target

🧱 1. Market Structure Breakdown
EURGBP has been trading within a descending channel, forming consistent lower highs and lower lows, which indicates a short-term bearish trend. However, price action recently broke out above the upper boundary of this channel, suggesting a potential bullish reversal or trend correction.

This breakout marks a significant structural shift in market behavior.

🔵 Old Structure: Bearish, confined within the channel

🟢 New Structure: Bullish breakout above trendline + key resistance zone

🧩 Implication: Change in directional bias; potential for long opportunities

📍 2. Breakout Confirmation
The breakout was confirmed by:

A strong bullish impulse candle that closed above the descending trendline

Price sustaining above previous resistance (~0.8405)

Increase in bullish volume at the breakout point (if volume indicator is used)

This suggests that the breakout is genuine, not a false spike or liquidity grab.

🌀 3. Retest Phase – The Critical Zone
After breaking out, the market is now pulling back to retest the previous structure. This is a textbook price action move:

🔄 What’s Being Retested?
✅ Upper boundary of the descending channel

✅ Major horizontal support/resistance zone (~0.8405–0.8415)

✅ Broken trendline from previous lower highs

✅ QFL base (Quasimodo level that was swept)

✅ 50% Fibonacci retracement of the breakout move

This zone forms a multi-level confluence area, making it a strong support for potential long entries.

🔍 4. Key Technical Observations
Element Description
📐 Descending Channel Defined the prior bearish structure. Breakout invalidates this bias.
🧱 Trendline Retest Acts as dynamic support; price currently sitting on it.
🔃 SR Flip Zone Old resistance (~0.8405) turned into support—critical level.
📊 Fib 50% Retracement Provides technical alignment with potential buying interest.
📌 QFL/Order Block Zone Historical demand was swept and now being respected again.

🎯 5. Target Levels & Trade Plan
If the structure holds and the price responds bullishly from the current zone, the next levels of interest are:

✅ Primary Target – 0.8460
A clear supply/liquidity zone from previous structure highs

Also aligns with psychological round number and Fib extension

⚠️ Interim Target – 0.8430
Previous intra-channel resistance level

May serve as a short-term reaction point

❌ Invalidation Level
A clean break and close below 0.8390 would invalidate the breakout structure

This would reintroduce bearish pressure and signal a potential fakeout

🧠 6. Trade Idea (Not Financial Advice)
Entry: Around 0.8405–0.8415 on bullish confirmation (e.g., engulfing candle, pin bar, break of minor downtrend)

Stop-Loss: Below 0.8390 (beneath structure & invalidation point)

Take-Profit 1: 0.8430

Take-Profit 2: 0.8460

This offers a high R:R opportunity if managed with proper confirmation.

🧭 7. Risk Management & Considerations
Avoid entering prematurely without a bullish signal (e.g., pin bar, engulfing, RSI divergence).

Monitor macroeconomic news—especially from BoE or ECB—as they can disrupt technical setups.

Scaling into the position or using a split TP strategy can help protect profits.

✅ Conclusion
This EURGBP setup is a textbook case of market structure trading:

A well-defined channel breakout

Followed by a clean pullback to structure

With confluence across horizontal, diagonal, and Fibonacci levels

If price respects this zone, bulls could drive toward 0.8460, offering a solid opportunity for traders who understand structure-based setups.

📌 Always wait for confirmation—structure gives us context, but entries need price action signals to minimize risk.