In this episode we are looking at a bearish bat on the euro-pound! Price has consolidated a little between the A, B and C coordinates, giving great shape to the movement. The D point is forming in an area where price has previously bounced- if the weekly chart is anything to go by, there has been a lot of action around this level.
As always, I'm drawing the chart up very early; there may be economic data released that alters the direction of the final CD wave before it reaches the D point, but I will keep an eye on this pair until then.
After the rally on the weekly chart, price peaked at 0.915 before it retraced and began to consolidate. If you take your fib took, the 0.886 D point for the bat lands around the same level as the 50% retracement level of the whole price swing. It is just as likely that price will drop before reaching this level, but, if it does, I will be entering a huge short position!