Despite this unit now lurking around both H4 supply and a daily supply drawn from 109.26-109.83, our team has no interest in selling. The reasoning behind this approach stems from the weekly chart. Check out how aggressive the weekly bulls have been since rebounding from weekly demand at 105.19-107.54. Furthermore, notice that there’s ample space on this timeframe for price to continue driving north until weekly supply at 113.80-111.59. To that end, what we’re watching for at the moment is a close above the 110 handle. This would, as far as we see it, achieve the following:
1. Open the H4 path north up to H4 resistance at 110.84.
2. Push price above the current daily supply at 109.26-109.83 and potentially clear the runway up to daily resistance at 110.96 – a few pips above the H4 line 110.84.
In addition to these two points it would also allow traders the chance to enter long on any retest seen of 110 as per the green arrows. For us to be given the green light to buy, nonetheless, we would require a lower timeframe buy setup to form following the retest of 110. This could be in the form of an engulf of supply, a break/retest or even simply a collection of buying tails around the 110 number. Of course, this trade may not come to fruition today, but we believe it is certainly something to have noted down in your watch lists for next week!