Pushing forward, however, this pair still appears very weak at present, as over the past few weeks, price has seen very little buying interest from within the weekly range demand at 1.0519-1.0798. Meanwhile, down on the , market action also recently closed below support at 1.0616, and as a result, is now within touching distance of connecting with demand once again at 1.0519-1.0583. Alongside this, H4 price shows that although demand at 1.0569-1.0596 held, stops were likely taken out from below this area due to Wednesday’s spike seen at 1.0564, thus potentially weakening this zone.
For this reason, we personally believe this pair has further to decline yet. As such, we have our eye on the swap at 1.0636 for confirmed shorts today (confirmation needed here due to the possibility of a fakeout). In addition to this, we also are watching the mid-level support 1.0550 for confirmed longs, which if you look back in history you’ll see this barrier has provided this market a strong ‘floor’ to trade from on a number of occasions. What is more, this level is still positioned within both the above said weekly range demand and daily demand. The reason for requiring confirmation to buy at 1.0550 simply comes from the clear downtrend this market is in at the moment.