By: Doug Rosen
For the last couple days the EUR/GBP has been in a range. After a pair makes a steep move it tends to reconsolidate for a couple days to catch its breath. Usually what price is really waiting for is the ema's to catch up with it. So price consolidates for a period of time forcing the ema's to come its way, then when it does, the ema's carry price along with it. What I have always loved about this pair is its tendency to trade technically. For a skilled technical trader the EUR/GBP is the perfect pair to trade.
On the weekly time frame price is way outside of the Bollinger band and standing on a trend line that has been respected int he past and shortly below that is the 233 ema that when reached will surely for price to head up for a bit. The weekly stochastics is also in the oversold zone.
On the daily time frame price is falling very close to visual support around .8350 when reached will trigger a bounce up I am sure.
On the 4 hour time frame price has tapped a bottom trend line four times so far. The ema's are losing their angles and separation with each other so price is slowing. This usually happens when price touches a strong area of support or resistance. It slows, ranges then slowly reverses.
On both the hourly and 15 minute time frames price is in a range and the ema's are all bunched together and price is confined within a narrow Bollinger tunnel that will soon compress price and force it out in either direction.
I am thinking more up than down considering the strong visual support, however, all price has to do is range and give the longer term ema's a chance to catch up with price and force it down even further. I am anticipating a bounce up for technical reasons.