You have seen me talk about the influence of cross on spot trading and this is how I look at it using EURGBP to illustrate:.
– When you see a straight line move down as in this chart (I look at the 15 min chart), it suggests there is a real money flow (order) driving, in this case, EURGBP lower.
– So you know GBPUSD is being bought and EURUSD is being sold.
= During this straight-line move, given the current trend, GBPUSD will be supported.
– Once EURGBP finds support, either GBPUSD will lose its strong bid or EURUSD will play catch-up.
– In this case, GBPUSD has lost its bid and slipped once the EURGBP bounced off its low.
If you ever played the game “Hot Potato” you can go with the flow until the music stops (i.e. order is filled)