Before we discuss possible setups in this market, let’s take a look at the overall picture. Looking up to the weekly chart, sellers are in the process of stamping in a clear selling wick just ahead of a long-term at 1.3501-1.3804. Despite this, a quick scan on the shows that the buyers and sellers are currently battling for position within the lower limits of a chalked up at 1.3371-1.3279.
Our suggestions: Given the above notes, here is what we have logged going forward:
• Although price is currently finding support off the top edge of a H4 at 1.3290-1.3242, we would not consider this since there is not only a far more attractive zone just below between the lower edge of the current H4 and a H4 drawn from 1.3261, but price also has to contend with the 1.33 band. Bolstered by a H4 completion point at 1.3254, a H4 mid-way support 1.3250 and a H4 50.0% Fib support seen around the 1.3250 region, the above noted H4 buy area is likely to bounce prices. However, seeing as how the present H4 is positioned slightly below the current daily , and what with weekly action painting a rather picture right now, we would only consider the above H4 buy zone as valid on the basis of a lower timeframe confirming buy signal. What we look for is either an engulf of supply followed by a retest, a break/retest or simply a collection of well-defined buying tails around the higher-timeframe buy zone.
• Should the above said H4 be taken out, nevertheless, short trades on the retest of this boundary down to at least the 1.32 number, followed closely by H4 support at 1.3174 is also something we have our eye on today.