Daily Timeframe: From the , we can see that yesterday’s daily candle took out a major daily demand area coming in at 1.0760-1.0872 (encapsulates major daily swap level at 1.0825), and hit the daily Quasimodo coming in at 1.0664.
4hr Timeframe: The EUR/USD pair, as you can see, took out the 1.0800 barrier with relative ease, and dropped further south consequently faking below the 1.0700 number into the aforementioned daily Quasimodo .
We remain cautious about buying around the 1.0700 region considering the monster downtrend the Euro is in right now. Nevertheless, we cannot ignore the fact that this pair is, from a technical standpoint, in oversold territory (see above). Therefore, if we were to buy from here, we would need attractive confirmation from the lower timeframes.
In the event that further selling is seen today, and price manages to close below the aforementioned daily Quasimodo , this would, in effect, be our cue to begin watching for price to retest this line as resistance. However, any sells taken from here would (for us) require lower timeframe confirmation from the 30 minute timeframe and above, since let’s not forget that we would essentially be selling into weekly demand (1.0499-1.0740) at that point.
Current buy/sell orders:
• Buy orders: watching the 1.0700 region for lower timeframe confirmation (Predicative stop-loss orders seen at: dependent on where one confirms this level).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).
I agree with what you said. Once, or if price takes out the weekly demand area seen at 1.0499-1.0740, it seems the path is then clear down to a weekly swap level at 1.0411. If we clear this baby, we could potentially hit the weekly swap level coming in just above parity at 1.0156.