Daily Timeframe: Further selling was seen yesterday from the daily swap level visible at 1.1411. This move has consequently forced price once again to attack a small daily demand area seen at 1.1260-1.1318.
4hr Timeframe: The recent sell off on the Euro has seen price hit a small 4hr demand area at 1.1304-1.1318, which if you look on the you’ll notice is located within the upper limits of the aforementioned daily demand area. We agree that buying from this 4hr area looks tempting; since in addition to being located within higher-timeframe demand, there is also a clear profit gap seen from here up to at least 1.1379. However, let’s not forget that in buying from here, we would likely be trading with higher-timeframe opposition coming in from around the aforementioned weekly supply area (see above). Therefore, for us to even consider buying the Euro here, lower timeframe confirmation would need to be seen before we put any money at risk.
Conversely, selling is obviously supported by the fact price trading below the aforementioned weekly supply area at the moment, however, selling into daily/4hr demand (see above) is just something our team cannot condone, no matter what’s supporting it!
In the event that the current 4hr demand area fails to hold the market, traders can likely expect prices to decline in value down to at least the 4hr swap level seen at 1.1278 (located around the lower limits of the aforementioned daily demand area).
Current buy/sell orders:
• Buy orders: Waiting for lower timeframe confirmation around 4hr demand at 1.1304-1.1318 (Predicative stop-loss orders seen at: 1.1297).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).