Daily view: The reaction seen from daily support at 1.1143 was clearly the motivator, if you will, to attract further buyers into the market last week. From this level, the bulls pressed forward eventually attacking the daily Bat reversal zone at 1.1516/1.1376 (located deep within the aforementioned weekly supply area) for the second time. Instead of selling interest being seen from this area, we saw Friday’s daily candle close above a daily Quasimodo at 1.1421 seen within this Daily Bat zone. If the buyers manage to hold their positions above this hurdle this week, it’s likely we may see further upside to this pair.
4hr view: In the midst of Friday’s sessions, the Euro pair sold off from the 1.1400 number– faked below the swing low 1.1338 seen marked in green, and saw a sharp rally north consequently taking out 1.1400 and testing the 4hr seen at 1.1443 (positioned relatively deep within the aforementioned daily Bat zone).
So that we’re all on the same page here, let’s just recap. The weekly chart shows price currently dancing within supply at the moment, that’s easy enough for everyone to see. The on the other hand, is not so straight forward. Granted, price is trading within a daily Bat reversal zone, but with Friday’s close seen above the aforementioned daily Quasimodo it does not exactly instill confidence for us to begin looking for sells (see above for all higher-timeframe levels). So where does this leave us on the 4hr chart?
As far as we can see, there is not really much room for price to move at the moment unless one is looking for small intraday trades. A move north from current price will almost instantly place the Euro within the jaws of a relatively long-term 4hr supply area coming in at 1.1532-1.1476 (located deep within the aforementioned weekly supply area). A push south from the aforementioned 4hr on the other hand, will very likely just as quickly see price shake hands with 1.1400. In the same way, should a break below this number be seen, price will in all likelihood greet 4hr demand at 1.1322-1.1358 not too long after. We’re sure you’re getting the picture by now…Unless there is an explosive move seen today, traders are likely going to be forced to look for only small intraday moves, or simply not trade at all.
Personally, we’re not interested in intraday trading today, especially on Mondays when liquidity is generally low in the market place. For anyone who is intending to trade any of the above levels, we would strongly advise waiting for some sort of lower timeframe confirming signal before risking capital.