Weekly levels to watch this week fall in at: 1.1532-1.1278/1.0519-1.0798.
Daily view: Moving down to the , we can see that price reacted beautifully from the underside of an ignored Quasimodo level at 1.1372. The move from here took out both demand sitting at 1.1211-1.1268, and also demand drawn from 1.1015-1.1076. In the event that the majority of bids are taken out from this zone, the pathway, at least on this timeframe, is likely clear down towards demand seen at 1.0846-1.0903. In addition to this, there’s a nice-looking pattern that converges just beautifully with the lower limit of this demand at 1.0873 – Just beautiful confluence!
Daily levels to watch this week fall in at: 1.1015-1.1076/1.1107/1.0846-1.0903/1.1211-1.1268.
4hr view: As already mentioned above, Friday’s sessions saw further downside, which, from the 4hr timeframe, took out demand at 1.1015-1.1052 and connected with bids sitting at psychological support 1.1000 just before the close.
Going forward, this morning’s open saw price dip below 1.1000 by two pips at 1.0998, but has so far remained bid for the time being. From the 4hr scale, there is really not much room for this market to move. Directly above current price sits a supply drawn from 1.1055-1.1026, and thirty pips below, a swap at 1.0973. It will be only until one of these areas is consumed will we see any true room for this pair to stretch its legs. A break above supply at 1.1055-1.1026 could suggest further upside towards psychological resistance 1.1100, followed closely by supply at 1.1138-1.1108 and an ignored Quasimodo level 1.1145. On the other side of the coin, a break below swap support at 1.0973 shows space for price run down to psychological support 1.0900. Remember guys, 1.0900 lines up perfectly with the top-side of the daily demand mentioned above at 1.0846-1.0903 – this could be a wonderful place to look for longs into this market.
Overall though, we are favoring a break lower here due to the current higher timeframe structure (see above). Therefore, should a close be seen below 1.0973 today, we’ll be watching for two things to happen before we consider a short. Firstly, a retest of this number as resistance, and secondly, lower timeframe selling confirmation following this retest.
Levels to watch/live orders:
• Buys: Watch for offers to be consumed around 1.1055-1.1026 and then look to trade any retest seen at this area (confirmation required) 1.0900 Tentative – confirmation required (Stop loss: dependent on where one confirms this level).
• Sells: Watch for bids to be consumed around 1.0973 and then look to trade any retest seen at this level (confirmation required).