The EUR, as you can see, made considerable ground against its US counterpart yesterday, conquering both the H4 supply area at 1.0670-1.0639 (now acting support zone) and the psychological band 1.07. Providing that the bulls remain in the driving seat above this number today, we could very well see price challenge 1.0796 – a H4 Quasimodo resistance line that’s positioned nearby the tip of a H4 Harmonic (Bat) potential reversal zone at 1.0809 and the 1.08 handle.
According to weekly structure, there’s room seen for the major to continue trading northbound until we reach the long-term weekly trendline resistance extended from the low 0.8231, thus adding weight to a long from the 1.07 neighborhood. Despite both the weekly and H4 structure depicting a bullish stance, however, daily action is currently seen teasing the underside of a daily resistance line at 1.0710, hence our need for a confirming retest and H4 bull candle off 1.07 before pulling the trigger!
Our suggestions: In the event that price does retest 1.07 and chalk up a bullish H4 confirming candle, we’ll look to trade long, targeting the above noted H4 Quasimodo resistance at 1.0796. As already stated, this level also converges with the tip of a H4 Harmonic (Bat) potential reversal zone at 1.0809 and the 1.08 level, but what you might not see if you focus on only one chart for your trading, is that it’s also located nearby the long-term weekly trendline resistance highlighted above! Therefore, not only is this level a fantastic take-profit zone, it is also a strong location to watch for shorts!
Data points to consider: EUR CPI reading at 10am. US CPI report at 1.30pm, FOMC member Kashkari speaks at 4pm, Fed Chair Yellen speaks at 8pm GMT.
Levels to watch/live orders:
• Buys: 1.07 region (a H4 bull candle is required here before a trade can be executed, stop loss: ideally beyond the trigger candle).
• Sells: 1.08 region (this is an area where we would consider trading without confirmation, stop loss: 1.0815, aggressive stop, 1.0875, conservative stop).
According to weekly structure, there’s room seen for the major to continue trading northbound until we reach the long-term weekly trendline resistance extended from the low 0.8231, thus adding weight to a long from the 1.07 neighborhood. Despite both the weekly and H4 structure depicting a bullish stance, however, daily action is currently seen teasing the underside of a daily resistance line at 1.0710, hence our need for a confirming retest and H4 bull candle off 1.07 before pulling the trigger!
Our suggestions: In the event that price does retest 1.07 and chalk up a bullish H4 confirming candle, we’ll look to trade long, targeting the above noted H4 Quasimodo resistance at 1.0796. As already stated, this level also converges with the tip of a H4 Harmonic (Bat) potential reversal zone at 1.0809 and the 1.08 level, but what you might not see if you focus on only one chart for your trading, is that it’s also located nearby the long-term weekly trendline resistance highlighted above! Therefore, not only is this level a fantastic take-profit zone, it is also a strong location to watch for shorts!
Data points to consider: EUR CPI reading at 10am. US CPI report at 1.30pm, FOMC member Kashkari speaks at 4pm, Fed Chair Yellen speaks at 8pm GMT.
Levels to watch/live orders:
• Buys: 1.07 region (a H4 bull candle is required here before a trade can be executed, stop loss: ideally beyond the trigger candle).
• Sells: 1.08 region (this is an area where we would consider trading without confirmation, stop loss: 1.0815, aggressive stop, 1.0875, conservative stop).
IC Markets is an online forex broker specialized in providing transparent trading solutions to both retail and institutional investors alike. We provide superior execution technology, lower spreads and unrivaled liquidity.