The higher picture resembles the following:
• Buyers are still seen deep within weekly supply territory at 1.76297-1.67702, with a little interest being shown by the sellers at the moment.
• The still shows price is currently trading in no man’s land between daily supply above at 1.76297-1.73024 and daily S/R flip level seen below at 1.69712.
Sellers meant business as they smashed through the round number 1.71000 and traded right into none other than the 4hr S/R flip area at 1.70617-1.70459, where a picture-perfect reaction was seen, as reported may happen in the last analysis.
Things have changed slightly from the when we analyzed this pair last, in that all the buyers need to do is to consume the majority of the sellers around the high marked with an arrow at 1.71428 which as a result would possibly clear the path right up to the round number 1.72000. (UPDATE: Price just consumed the aforementioned high).
Now we know the path may be possibly clear up to the round number 1.72000, where could price move to next? Price could very well rocket straight up to the aforementioned round number, but that would be too easy! We will likely see a retracement back down to the origin of the original rally up at around the aforementioned 4hr S/R flip area (demand), before higher prices are seen.
Why would a retracement be seen after the path is believed to be clear north? If we try to think like pro money does, and consider that they want the BEST prices on every move, what would you do? Personally we would sell price hard again tempting sellers on the lower timeframes to join in on the momentum, we would then break the round number, consuming buyers and breakout sellers around there, and finally hit our destination at around the 1.70622 area. What have we done during all this apart from stopping out a bucket load of traders? We have gathered the much needed liquidity in the form of sell orders for us to buy into, thus allowing us (Pro money) to trade.
Pending/P.A confirmation orders:
• New pending buy orders (Green line) are seen just above demand (1.70617-1.70459) at 1.70662. The reason a pending buy order has been set here is because the buyers have now proved this area by consuming sellers around the high marked with an arrow at 1.71428 thus possibly clearing the path north up to around the round number 1.72000 area. A retracement down to the 4hr S/R flip area at 1.70617-1.70459 is expected soon to gather liquidity, which should in turn fill the aforementioned pending buy order in the process.
• No P.A confirmation buy orders (Red line) are seen in the current market environment.
• No pending sell orders (Green line) are seen in the current market environment.
• P.A confirmation sell orders (Red line) are seen just below the round number 1.72000 at 1.71943. We have placed a P.A confirmation sell order here simply because these psychological levels are prone to deep tests/spikes, so sometimes it is better to wait for that all important confirmation.
• Areas to watch for buy orders: P.O: 1.70622 (SL: 1.70423 TP: Dependent on price approach) P.A.C: No P.A confirmation buy orders are seen in the current market environment.
• Areas to watch for sell orders: P.O: No pending sell orders are seen in the current market environment. P.A.C: 1.71943 (SL: Dependent on price action after the level has been confirmed TP: Dependent on approaching price action after the level has been confirmed).