By: Doug Rosen
Yesterday's bearish move for the EURGBP was a very strong move and the weekly candle so early in the week has been dragged a long distance from the weekly 5 ema and it has even fallen slightly outside the lower Bollinger band.
On the daily time frame same story, today's new daily candle is a large distance from the 5 ema and outside the lower Bollinger band. The weekly and daily stochastics are in the oversold zone.
On the 4 hour time frame price is also spaced from the 4 hour 5 ema and extended outside the Bollinger band. This is all extremely bearish of course, however, for price to really continue onward it will need more energy and a tap back at the weekly, daily and 4 hour 5 ema's will give price the energy it needs to keep tanking. So what I will be watching for on both the 4 hour and daily time frames will be for price to begin to rollover a bit and head up towards their respective 5 ema's.
On the hourly time frame price has maintained itself around .8450 and looks like it may want to soon start making its way back up possibly to the 21 ema. Price does not have to do that however, it can keep heading down but most likely it will need to head up a bit to keep falling since price is not at a level that will attract sellers but buyers could see the opportunity. To determine if this pair will keep tanking watch for it to break yesterday's low then retest then watch for a couple 1 minute swing fibs to take a short or wait for a couple swing highs then take a long on a fib.
