GBPUSD crashed massively after the tax rate cuts news broke off. This news acted as a catalyst in the forex market to drop GBP. Now, we are anticipating a rebound on the pair before it further declines. We have formed two bullish engulfings. We will wait for the prices to retrace on the engulfing to take the long entry. The upside will be towards the previous resistance.

There is no trendline indication on this setup.

We are looking at the retracement of the candle and not the move. This candle retracement will give us a bullish momentum towards our profit target.

EMA 50 is bearish therefore, the trend still remains bearish. We only are taking the bullish correction on this pair. We might not even retest the EMA recently.

The RSI is at 33. It is a slightly above the over sold region and has the potential to tap the over sold region and form a bullish divergence which will act as a technical indicator to our confluence. 

Expecting a rebound after crash

Sep 26 2022