Weekly Timeframe: Strong buying has been seen on the Euro, and as a result saw price aggressively break above the weekly support flip level (1.27541) into a strong-looking weekly supply area at 1.29941-1.28583.
Daily Timeframe: The daily timeframe shows that price is currently trading within a small daily supply area seen at 1.29001-1.28453 (located within the strong-looking weekly supply area mentioned above at 1.29941-1.28583). Assuming a bearish reaction is seen here, the first area of concern for the sellers on this timeframe comes in at 1.27500, a small daily resistance flip level.
4hr Timeframe: As we have already seen on the higher timeframes, strong buying came into the market yesterday. Price broke above both the 1.27 level and the 4hr decision-point area at 1.27894-1.27731, it was only until price reached a minor 4hr Quasimodo resistance level at 1.28667 did selling interest come into the market.
Considering the fact that price is trading within higher-timeframe supply areas (Weekly: 1.29941-1.28583, Daily: 1.29001-1.28453) at the moment, we are naturally expecting to see some sort of sell off in the market.
In our opinion, selling strength from the higher-timeframe supply areas will only be confirmed once/if price consumes possible buying apposition around the 4hr supply flip area at 1.27894-1.27731 (tentative buy orders seen just above at 1.27939). It is only then would we begin looking for selling opportunities.
Buy/sell levels:
• Buy orders: 1.27939 (Predicative stop-loss orders seen at: 1.27661).
• Sell orders: N/A (Predicative stop-loss orders seen at: N/A).