Moving down to the 4hr scale, Friday’s sessions reveal price rallied from a low of 1.0854 and crossed swords with round number resistance at 1.0900, which hammered the Euro home south to end the week deep within a 4hr potential reversal zone (PRZ) at 1.0847-1.0800.
Going forward, Sunday’s open 1.0828 shows little change was seen over the weekend. As a result, price is still sitting within the aforementioned 4hr (PRZ), which so happens to converge with the following structures:
1. Encapsulates the daily swap level 1.0820.
2. The lower limit of our pattern has been expanded slightly to include the 1.0800 round number which also represents the top-side of a weekly demand area at 1.0519-1.0798.
3. 4hr convergence from the low 1.0461.
4. value 1.272%.
Therefore, as long as our analysis is correct, the EUR currency should appreciate today/this week. Nevertheless, as tasty as this zone may look, there may still be a fakeout below the 1.0800 handle to accumulate liquidity to push this market higher. For this reason, we are not going to be entering at market; we’re going to WAIT for the lower timeframes (15 min/60 min) to confirm buying strength exists within this highly confluent 4hr structure before risking capital to this idea.
Levels to watch/live orders:
• Buys: 1.0847/1.0800 Tentative – confirmation required (Stop loss: 1.0785).
• Sells: Flat (Stop loss: N/A).