Quick update: Looking to sell around the 1.33 mark...
The buyers managed to find their feet early on in the day yesterday, bidding sterling up to the 1.32 handle going into the early hours of the European open, which shortly after saw price consolidate for the remainder of the trading day. Looking at the H4 candle action, it appears that the bulls remain in the driving seat for the time being.
With that being said, how do things stand on the higher timeframes? Daily action has put in some space above the recently broken resistance level at 1.3104 (now acting support), suggesting that the bulls may continue to march north today to shake hands with the daily supply zone seen at 1.3371-1.3279. In addition to this, weekly candles recently chalked up a relatively nice-looking bullish engulfing candle, which seems to have sparked a bullish reaction in the market. However, while further upside is possible let’s not forget that this pair remains in a relatively strong downtrend at present!
Our suggestions: Watch for the unit to breach the 1.32 handle today as this would likely prompt further buying up to a H4 resistance area at 1.3290-1.3242, and more importantly, the H4 harmonic Gartley reversal zone seen between 1.3346/1.3263 (green zone). Seeing as how this H4 harmonic area is lodged within the daily supply mentioned above at 1.3371-1.3279 and the predominant trend is pointing south, a short within this region is certainly something that interests us. Ideally, we’re looking to sell around the 1.33ish region with our stops placed above the X point of the H4 harmonic pattern.
Levels to watch/live orders:
• Buys: Flat (Stop loss: N/A).
• Sells: 1.33 region (Stop loss: 1.3374).
With that being said, how do things stand on the higher timeframes? Daily action has put in some space above the recently broken resistance level at 1.3104 (now acting support), suggesting that the bulls may continue to march north today to shake hands with the daily supply zone seen at 1.3371-1.3279. In addition to this, weekly candles recently chalked up a relatively nice-looking bullish engulfing candle, which seems to have sparked a bullish reaction in the market. However, while further upside is possible let’s not forget that this pair remains in a relatively strong downtrend at present!
Our suggestions: Watch for the unit to breach the 1.32 handle today as this would likely prompt further buying up to a H4 resistance area at 1.3290-1.3242, and more importantly, the H4 harmonic Gartley reversal zone seen between 1.3346/1.3263 (green zone). Seeing as how this H4 harmonic area is lodged within the daily supply mentioned above at 1.3371-1.3279 and the predominant trend is pointing south, a short within this region is certainly something that interests us. Ideally, we’re looking to sell around the 1.33ish region with our stops placed above the X point of the H4 harmonic pattern.
Levels to watch/live orders:
• Buys: Flat (Stop loss: N/A).
• Sells: 1.33 region (Stop loss: 1.3374).
IC Markets is an online forex broker specialized in providing transparent trading solutions to both retail and institutional investors alike. We provide superior execution technology, lower spreads and unrivaled liquidity.