Weekly closing price: 1.0882
Weekly view: As you can see, the shared currency continued to push lower last week, consequently breaking through support at 1.0970 (now acting resistance) and closing nearby a major support barrier drawn from 1.0819. With this level having been a considerable support since mid-May 2015, a bounce from this neighborhood is likely. However, the other key thing to note here is that just below it we see a long-term support taken from the low 0.8231 and an completion point around the 1.0667ish area (black arrows). Therefore, a whipsaw through 1.0819 is something we should all be prepared for prior to serious buyers step in.
Daily view: The does not seem to be throwing up any red flags as the path south appears clear for price to shake hands with the above said weekly support hurdle. Should the sellers hit the brakes here and reverse without striking the weekly support, nonetheless, we would consider the seen at 1.1039-1.0998 to be a viable area for price to rebound from, since it merges with the key figure 1.10.
H4 view: A quick recap of Friday’s trading on the H4 shows just how dominant the sellers were! The only relief the EUR saw was during the US session where price found a pocket of bids just ahead of the mid-way support 1.0850, pushing price to highs of 1.0888 by the day’s end.
Direction for the week: Until the pair touches gloves with the weekly mentioned above at 1.0819, we strongly feel price will continue to lose ground this week.
Direction for today: The opening candles will likely want to cross swords with the nearby broken H4 Quasimodo resistance at 1.0903, which fuses beautifully with psychological resistance 1.09. Personally, we don’t imagine price making much headway beyond this point. If it does, however, we’d then be looking for the candles to connect with the aforementioned daily supply base.
Our suggestions: A retest of the 1.09 region followed by a reasonably sized H4 close is, at least in our book, worthy of attention. A short could be taken from here, targeting the mid-way support 1.0850 and then the weekly support at 1.0819 as your final take-profit zone.
Data points to consider today are mainly speeches from Fed officials at 1pm and 6pm. In addition, there’s also European manufacturing data scheduled for release between 7-8am GMT , which, in our opinion, should not be ignored.
Levels to watch/live orders:
• Buys: Flat (Stop loss: N/A).
• Sells: 1.09 region (H4 close required prior to pulling the trigger, Stop loss: ideally beyond the trigger candle).