Daily Timeframe: The reason for the weak buying seen out of the aforementioned weekly demand area can be seen on the . Check out the three selling wicks (0.78984/0.78938/0.78936) seen around the 0.78729 level. Only once this level is consumed (daily close above) can price in our view continue higher. At the time of writing, we see very little stopping price from trading all the way back down towards the daily demand area for the second time at 0.77507-0.77772, which is located relatively deep within the major weekly demand area mentioned above.
4hr Timeframe: By looking at the 4hr timeframe, we can see that the strong-looking combined 4hr supply/round number area at 0.79133-0.78886/0.79 is a more precise zone in our opinion that’s stopping further buying out of the weekly demand area (levels above). Notice that the three selling wicks seen on the above the 0.78729 level were fakeouts to this combined 4hr area. Beautiful price action!
With the above taken into consideration, this week will likely begin with price trading into a 4hr demand area at 0.78271-0.78399, where a reaction could indeed be seen. However, we shall not be buying here since we feel this area has already been weakened by the touch seen on the 07/10/14 at 0.78357. The market will likely continue trading south bouncing off of all the minor areas of demand until it reaches the 4hr Quasimodo seen at 0.77840 (active buy orders are seen just above at 0.77876). Why this level? If you remember from the daily-timeframe analysis, price was relatively free to trade down to an area of daily demand (0.77507-0.77772), and seeing that the 4hr Quasimodo is sitting just above this daily demand area, it is very likely a high-probability buying opportunity.
• Buy orders: 0.77876 (Predicative stop-loss orders seen at: 0.77618).
• Sell orders: N/A (Predicative stop-loss orders seen at: N/A).