ICmarkets

EUR/USD Technical weekly outlook and review.

FX:EURUSD   Euro Fx/U.S. Dollar
27 0 1
Weekly TF.

Price appears to have formed yet another bullish pin-bar pattern within weekly demand at 1.32940-1.34847 last week, only this time bigger, and more prominent that the previous week’s pin bar. This is quite surprising to see as most of last week saw selling into the aforementioned weekly demand area; we were even expecting a break below. As per this timeframe, assuming we see higher prices continue, the first trouble area is seen around weekly supply at 1.36995-1.35844.

Daily TF.

Some very serious buying pressure came into the market on Friday last week. Active buyers were clearly sitting around the daily level of interest at 1.33559, as a push up to the daily decision-point area 1.34433-1.34202 was seen. Considering we are in weekly demand (see above), a break above this area is expected, which will likely force prices to test the daily D/S flip area above at 1.34760-1.35265.

4hr TF.

Once the buyers had consumed most of the sellers around the 1.33774 level, we knew price was likely free to hit the round number 1.34, and also the 4hr decision-point area at 1.34234-1.34084. We certainly did not expect a reaction to be seen at the 4hr decision-point area above that at 1.34433-1.34305 as the sell orders appeared consumed by the spike/wick marked with an arrow on the 1/8/14 within this area.

So taking into consideration what occurred late last week on the 4hr timeframe, and the fact that on the daily timeframe we are seeing price trading around a daily decision-point area (supply ) , but also not forgetting we are firmly sitting within weekly demand (levels above) as well. For us to have more confidence that higher prices are going to happen this week, we need a break above the 4hr decision-point area at 1.34433-1.34305 to happen, as this will also mean the aforementioned daily-decision-point area has been consumed also, so we can then expect higher prices up to the next fresh supply areas.

However before a push above these areas happen, pro money may not have the required liquidity, in this case sell orders for their buy orders, so a drop down to 4hr demand at 1.33360-1.33619 may take place, this will no doubt help pro money gain the much-needed liquidity boost, if, and only if they intend to push higher, which at the moment looks very likely.

Pending/P.A confirmation orders:

• New pending buy orders (Green line) are seen within 4hr demand (1.33360-1.33619) at 1.33526. We have placed a pending buy order here because this area of 4hr demand remains fresh, and as we are currently trading within weekly demand (1.32940-1.34847) at the moment, this area should see some sort of reaction on its first time back.
• No P.A confirmation buy orders (Red line) are seen in the current market environment.

• Pending sell orders (Green line) are seen just below the D/S flip area (1.34760-1.34943) at 1.34753.The reasoning behind setting a pending sell order here was because this is the area we believe on this timeframe pro money sellers made the decision to push prices south into (what was at the time) 4hr demand at 1.33984-1.34404, with the possibility of unfilled sell orders still waiting there.
• The pending sell order (Green line) set just below a 4hr decision-point area (1.34234-1.34804) at 1.34053 has been stopped out.
• No P.A confirmation sell orders (Red line) are seen in the current market environment.

• Areas to watch for buy orders: P.O: 1.33526 (SL: 1.33280 TP: Dependent on price approach). P.A.C: No P.A confirmation buy orders are seen in the current market environment.

• Areas to watch for sell orders: P.O: 1.34753 (SL: 1.35031 TP: Dependent on price approach). P.A.C: No P.A confirmation sell orders are seen in the current market environment.


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