The higher-timeframe picture resembles the following:
• Weekly TF: Selling pressure is still being seen from weekly supply at 1.76297-1.67702. The weekly demand area at 1.66917-1.67939 is where current trading is taking place; a push below here could force prices to test the weekly demand area below at 1.64589-1.66339.
• Daily TF: Current trading action is very deep within daily demand at 1.67367-1.68440 (where at the time of writing, the buyers seem to be showing a little interest now), which is neatly located around the weekly demand area (levels above). If we see a break below this daily demand area, prices would likely be forced to test the daily demand area below at 1.65492-1.66044, since most of the demand/buyers appear to have already have likely been consumed by two prominent tails/spikes (1.66559/1.66978). However, the break south has yet to be seen, so higher prices could still happen, the first trouble area for the buyers in our opinion is around the daily R/S flip level at 1.68963.
A beautiful to-the-pip reaction has been seen around the 4hr demand area at 1.67389-1.67561. From here the buyers aggressively pushed price above the round number 1.68, and in our opinion there’s not much stopping a rally higher up to the 4hr decision-point area above at 1.68919-1.68789.
Some are probably thinking why are they not looking at the 4hr supply area above around the 1.68518 area, here is two reasons why we believe this area to be weak:
1. The arrow to the left indicates all price was doing here was reacting off of another minor demand area, if we saw a close below here then the 4hr supply area would in our opinion be a troublesome area to be wary of.
2. The second arrow to the right is pointing to what we see as spikes/wicks back up to the zone as price was dropping south, this likely shows seller consumption, not a great sign when looking for supply areas!
As already mentioned, the break above the aforementioned round number was quite aggressive. We have now placed a P.A confirmation buy order just above this level at 1.68042 in an attempt to trade the retest, which could be the very place the buyers push price up to the already mentioned 4hr decision-point area at 1.68919-1.68789.
Pending/P.A confirmation orders:
• The pending buy order (Green line) set just above 4hr demand (1.67389-1.67561) at 1.67601 is now active. Our first take-profit level has already been hit at the round number 1.68, so do keep an eye on our second and final take-profit level set at 1.68789.
• New P.A confirmation buy orders (Red line) are seen just above the round number 1.68 at 1.68042. The reasoning behind setting a P.A confirmation buy order here, is simply because we have seen over time round number levels such as these are sometimes subject to deep spikes which often stop traders out, hence the need to wait for a little confirmation.
• Pending sell orders (Green line) are seen just below a 4hr decision-point area (1.68919-1.68789) at 1.68747, the reason for this type of order to be set is simply because the sellers have confirmed this area by consuming the buyers around (what was at the time) the 4hr demand area at 1.68013-1.68585, thus a pending sell order could be set knowing the path south is clear for the moment.
• No P.A confirmation sell orders (Red line) are seen in the current market environment.
• Areas to watch for buy orders: P.O: 1.67601 (Active)(SL: 1.67314 TP: 1.68 1.68789). P.A.C: 1.68042 (SL: Dependent on price action after the level has been confirmed TP: Dependent on approaching price action after the level has been confirmed).
• Areas to watch for sell orders: P.O: 1.68747 (SL: 1.69064 TP: Dependent on price approach). P.A.C: No P.A confirmation sell orders are seen in the current market environment.