Looking at the weekly, daily and 4hr charts, here is what we have jotted down so far:
1.5350 will play a key role in our decision-making process today – here’s why…
• As already mentioned, 1.5350 has so far held firm. From this region there was also a push/spike higher as the U.S opened for business, reaching highs of 1.5390 (black arrow) – from a technical standpoint, this may have cleared overhead supply for this market to rally. That being the case, there could be a move up to 1.5450 (since offers at 1.5400 are potentially weak now), and quite possibly the 4hr supply just above it at 1.5507-1.5478 today. Both areas converge nicely with a weekly swap (resistance) level coming in at 1.5451. Traders wishing to try and buy this market would do well to remain patient here and only enter when/if the lower timeframe confirmation is present.
• On the flip side, let’s not forget that a break below 1.5350 is also a possibility today. The reasons? Price is currently trading from the underside of daily supply at 1.5435-1.5384 and shows very little near-term support below. By the same token, beneath 1.5350 on the 4hr timeframe, there is clear space for profit down to at least 1.5300.
On the whole, this market could go either way today especially since at around 11am GMT the BoE is set to take the stage to discuss interest rates. Our team, nonetheless favors a break lower today given where price is positioned on the higher timeframes. It will be interesting to see how this plays out.
Levels to watch/ live orders:
• Buys: 1.5350 Tentative – confirmation required (Stop loss: dependent on where one confirms this level).
• Sells: Watch for bids at 1.5350 to be consumed and then look to enter on any retest seen at this number (confirmation required).