Daily action on the other hand has been confined within a range since the beginning of March between 112.56/113.96. A subtle close beyond the lower limits of this consolidation was seen yesterday suggesting the doors may now be open for a potential move down to the 110.96 region (the Feb 11th low), which is all that stands in the way of a move down to the weekly support mentioned above at 110.09.
Moving across to the H4 chart, we can see that since price sold off from weekly resistance, a 1:1 move (see black arrows) formed on approach to an area of support at 112.15-112.42, which is so far holding firm. Although we are seeing buying from here right now, we remain uncertain. With the weekly showing strength from resistance and daily price breaking below its range (see above), we feel this pair may be heading lower from here! Therefore, we’d be far more comfortable shorting this market on a break below and retest of the 112.00 figure today, since below here the path appears free down to 111.00 – effectively the daily support we mentioned above at 110.96.
Levels to watch/live orders:
• Buys: Flat (Stop loss: N/A).
• Sells: Watch for price to consume the 112.00 level and look to trade any retest seen thereafter (Lower timeframe confirmation required).