In this technical blog we are going to take a quick look at the $EURGBP 4 hour chart dated: 7th of November 2016. Pair since the October 7th peak (0.9224) was showing lower lows & lower highs, also was missing the extreme from the peak favored another push lower in the pair to happens to complete the 7 swing Elliott wave bearish swing sequence. It is important to note that W,X,Y in red has internal subdivision of (3,3,3) in each swing, which means all of the these 3 legs were corrective sequence in nature. Thus the idea was to selling the short term bounces in the pair labelled as wave (x) in blue in sequence of 3, 7 or 11 swings against (0.9048) for potentially downside target at (0.8778-0.8691) 100%-123.6% extension area from the peak.
EURGBP 8th of November 2016 1 hour NY updated chart : suggesting the pair was doing a short term bounce in wave (x) in blue to correct the cycle from 0.9049 peak & (0.8970-0.9021) 100-161.8% extension area from the lows was expected to reach in 3 swings before pair found seller’s again for potential downside target at 0.8778-0.8691 area or 3 swing pullback at least to allow member’s to create a risk free position in the pair.
EURGBP 9th of November 2016 1 hour Midday updated chart : Since then pair reached the selling area & formed the peak at 0.9023, which was the 161.8% extension area from the lows & turned lower as expected & reached our target area. Keep in mind chasing the weakness here could be risky now, although it keeps forming the lower lows & lower highs but the cycle from October 7th peak has already reached the extreme areas & pair soon needs to bounce in 3 swings at least.
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