Yesterday’s wide spread down bar continued the bearish momentum of Tuesday with a similar bar and which closed the day deep into the consolidation area between 0.87 and 0.91 suggesting that we could see a break below this area with a significant move lower.  As I mentioned in yesterday’s commentary after such a long fall it would be no surprise to see a short squeeze occur, which indeed has been the case in this morning’s price action with a move higher in the $uros to poundsr, as pounds sterling comes under pressure against the dollar and other currencies.  With all three moving averages now weighing heavily it is unlikely that any reversal will be more than a short term squeeze, and I would suggest looking for selling opportunities on any up move as indeed we are seeing this morning, using the hourly charts to enter these positions.  However, after such a significant fall we can also expect the market to take a breather for a few days and we may see a period of consolidation similar to that seen towards the end of February and early March, before any downward move is reinstated and depending on your trading psyche you may wish to wait a few more days before re-entering the market.

There is little in the way of $undamental newsthe economic calendar for cable and I have covered the euro relevant news items in the eurodollar site.  You can keep up to date with all the latest fundamental news on the economic calendar, latest currency news and live currency charts by simply following the links.  I have also included details on an excellent ECN broker.