During this scuffle around 1.0850, price action printed a B/C leg of a potential H4 which tops out around the 1.0907 mark. Supporting this, we can also see both a psychological resistance number drawn from 1.0900 and a 61.8% Fibonacci level at 1.0906. Together they likely form a tight concentration of offers in this market. However, there is a drawback to this trade. Daily supply at 1.0992-1.0951 hangs fifty pips above so price could very well ignore the H4 sell zone and head towards this barrier.
As a result, the best way we feel to approach this is to simply watch lower timeframe price action at the 1.0900 area. If one is able to spot selling strength building here i.e. a break of demand, a , a collection of selling tails around lower timeframe resistance, then we feel a short is viable. Targets, should the trade come to fruition, will (for us) adhere to Scott Carney’s trade management (first take-profit level 38.2% Fibonacci of the A-D swing second take-profit level at the 61.8% of the A-D swing ).
Levels to watch/live orders:
• Buys: Flat (Stop loss: N/A).
• Sells: 1.0900 region Tentative – confirmation required (Stop loss: dependent on where one confirms this area).