By: Doug Rosen
Yesterday was quite a drop for the GBP/USD, about 251 pips to be exact. As I said in other analysis today, this move totally caught me off guard and took me by surprise since the move seem to come out of nowhere. There was no true entry for this pair on the technical side unless you just happen to enter a short off the daily 55 ema which price did not quite touch. I was actually in a long when this pair tanked and was up 35 pips just to see my trade stop out at breakeven.
This move was mostly Swiss news inspired and that was the only news report that came out yesterday and the news took about an hour to be priced into the market. Price is currently approaching support at 1.5350 and I do believe it is about time for price to break support and keep falling but I have no doubt there will be some degree of profit taking which will cause a bounce up and a retracement before breaking support. The 1.5422 level is last months low and price just made a bounce off of it and rose up to touch the 5 ema and is heading back down. I would like to see a break below that level and a retest to jump into that short.
On the hourly timeframe there is lots of angle and separation between the ema's which is a sign price should keep falling.
The weekly S1 pivot is at 1.5440 so bundle that with last month's low around 1.5422 we support that will either be respected or broken, however, we are at a level where something soon must happen.
So I guess we need to watch for double bottoms to consider longs or breaks below 1.5420 to look for shorts.
