Although the 1.12 handle deserves attention, we would still exercise caution here! On the , the candles are currently lurking within a seen at 1.1224-1.1072. However, as we’ve mentioned in previous writings, there’s been little noteworthy intent registered from this barrier. Perhaps the most compelling factor here is that the are in the process of completing an pattern (black arrows) which terminates around the lower edge of the above said , and also converges with a support extended from the low 1.0516. In addition to this, weekly action remains trading around the underside of a major at 1.1533-1.1278, thus increasing the chances of a selloff being seen.
Our suggestions: All in all, our team is looking for prices to weaken from the 1.12 neighborhood today. For us personally though, a short trade will not be permitted until a H4 candle is seen. Targets for this trade fall in at the above said H4 demand, followed by the H4 support at 1.1075 and the 1.11 band (green zone). Not only is 1.1075/1.11 a good take-profit area for any shorts in this market, it’s also a fantastic barrier to look for longs. It sits within the depths of the aforementioned daily , as well as merging with both the above noted daily support and a deep H4 88.6% Fib support at 1.1081. Although the H4 buy zone will very likely bounce price, do keep in mind that by entering long from here you’re effectively buying into weekly flow.