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EUR/GBP Prepping for a Retracement

By: Doug Rosen

I will begin my analysis for EUR/GBP today with the daily chart. Yesterday the market opened away from the daily 5 ema and rose to it and nearly touched it. Now that price has made contact with the daily 5 I would normally expect continuation to the downside. Price has sicked the bottom of the trend line we are sitting on today and the lower Bollinger band is pointing down. The 5 ema has much space between it and the 13 ema and the 21 ema has space from the 55 ema and this means high speed and strong momentum for this pair at least on the daily perspective. Now that the daily candle has made contact with the 5 ema it is expected for the 5 to push price down, technically speaking.

EUR/GBP Daily 11/9/11

Moving on to the 4 hour chart I get a bullish indication. The 5 ema has just crossed above the 13 ema and price is above the 21 ema and the stochastics is pointing up. What could be is the EUR/GBP may need to retrace a bit to the upside, possible back up to the 4 hour 55 ema before continuing to the downside.

EUR/GBP 4 Hour 11/9/11

Moving on to the hourly chart I can see that price has tapped last week's low several times and has made since then a couple higher highs and higher lows indicating price could be on its way up for a bit. It has the weekly central pivot point at .8604 overlapped with the upper Bollinger band and the 144 ema to contend with before it can rise up much so I do expect some resistance in the .8605 region. Price action is currently above the daily central pivot point and yesterdays high was about .8600 so I expect a break above that level to prove to me that this pair will be heading up.

EUR/GBP 1 Hour 11/9/11

Doug Rosen
About Doug Rosen
Doug Rosen is a Florida-based Forex trader who became a skilled technical trader through 3 years of intense practice and self-teaching. He now coaches a live trading room and analyzes the market on forextradeplans.com.

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