ICmarkets
Short

Looking for shorts at the 1.1300 handle...

FX:EURUSD   Euro Fx/U.S. Dollar
230 2 5
The EUR/USD             pair cascaded lower from H4 supply at 1.1400-1.1383 during the course of yesterday’s sessions. Price engulfed H4 support at 1.1338 (now acting resistance) and went on to close below psychological support 1.1300 by the day’s end. Given that price is currently trading from both a major weekly supply zone at 1.1533-1.1278, and with the daily action seen holding ground amid supply at 1.1385-1. 1332             , yesterday’s sell-off should not come as much of a surprise from a technical standpoint.

Considering the higher-timeframe picture (see above) and that price is now lodged beneath 1.1300, we feel the single currency could make a try for at least the 1.1248 lows made on 14/15th April             today (pink circle). For all that though, in order for us to be permitted a short trade here, we’d need to see the lower timeframes confirm 1.1300 before risking capital at this line. What we mean by confirm here is simply one of the following: a break/retest of demand, a trendline break/retest or simply a collection of selling wicks around some form of lower-timeframe resistance.

Assuming that this trade comes to fruition and price hits its first target; we’d then be looking down to the H4 demand drawn from 1.1168-1.1190 as our final destination (sits on top of daily demand coming in at 1.1143-1.1187), which would essentially complete a nice-looking 1:1 move (see black arrows).

Levels to watch/live orders:

• Buys: Flat (Stop loss: N/A).
• Sells: 1.1300 region Tentative – confirmation required (Stop loss: dependent on where one confirms this area).
ICmarkets PRO arif_awan
Thanks for your input Arif!

Reply
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