Multi-timeframe demand in play
EUR/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
As we head into the early stages of April, March left us with a long-legged doji indecision monthly candle, with its extremes crossing paths with a heavyweight demand-turned supply zone at 1.1857/1.1352 and demand at 1.0488/1.0912.
To a degree, we’re now rangebound between the two aforementioned price structures; Notably, however, April’s candle is testing the top edge of 1.0488/1.0912.
The primary downtrend remains in motion, trading lower since 2008, exhibiting clear lower peaks and troughs.
Daily timeframe:
Overlooking Tuesday’s hammer candlestick pattern, formed a point off demand at 1.0925/1.0864, Wednesday noted moves to lows at 1.0902.
Opposition, in terms of resistance, steps in as the 200-day SMA value at 1.1077, with a break revealing a reasonably free reign to supply derived from 1.1239/1.1179 that merges closely with a trendline formation (1.0879).
Yet, below current demand, the ground appears prepped for an approach to demand at 1.0526/1.0638, an area extended from March 2017.
H4 timeframe:
Partially altered from previous analysis -
Demand at 1.0889/1.0937, the decision point to break 1.1045 (glued to the top edge of daily demand at 1.0925/1.0864), made its second appearance in recent movement, though on this occasion testing the lower limits of the demand at 1.0902. On a positive note, the current candle is in the process of pencilling in a bullish outside pattern, smothering two previous candles and suggesting moves higher may be on the cards.
To the upside, aside from tops around 1.1039 and Friday’s high at 1.1147, supply at 1.1336/1.1272 is exposed, intersecting with a 78.6% Fib retracement at 1.1310. Supply around 1.1210ish appears fragile (arc pattern), with the majority of orders consumed.
H1 timeframe:
H4 demand underscored above at 1.0889/1.0937 entered view mid-way through US trade Wednesday, exhibiting a hammer candlestick pattern two points shy of the 1.09 handle. As we head into Asia, the runway appears reasonably free to approach 1.10, with a break immediately exposing the 100-period SMA around 1.1022 and then 1.1050. Traders will also note the RSI indicator established a bullish divergence signal, with the second trough bottoming ahead of oversold terrain.
The story on the US dollar index has price action trading from a daily resistance area at 100.03/99.37 after the buck advanced on haven demand, with little reaction seen in wake of the final Markit manufacturing and ISM surveys. Therefore, a drop from 100.03/99.37 today may aid EUR/USD buying.
Structures of Interest:
The rebound from H4 demand at 1.0889/1.0937 reflects a bullish climate as we head into Asia Pac hours today, particularly if H4 price closes in the shape of a bullish outside pattern. This – coupled with monthly and daily price testing demand – is likely sufficient to encourage an approach to 1.10, with a break targeting the 100-period SMA at 1.1022 and then 1.1050, followed by the 200-day SMA at 1.1077.
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
As we head into the early stages of April, March left us with a long-legged doji indecision monthly candle, with its extremes crossing paths with a heavyweight demand-turned supply zone at 1.1857/1.1352 and demand at 1.0488/1.0912.
To a degree, we’re now rangebound between the two aforementioned price structures; Notably, however, April’s candle is testing the top edge of 1.0488/1.0912.
The primary downtrend remains in motion, trading lower since 2008, exhibiting clear lower peaks and troughs.
Daily timeframe:
Overlooking Tuesday’s hammer candlestick pattern, formed a point off demand at 1.0925/1.0864, Wednesday noted moves to lows at 1.0902.
Opposition, in terms of resistance, steps in as the 200-day SMA value at 1.1077, with a break revealing a reasonably free reign to supply derived from 1.1239/1.1179 that merges closely with a trendline formation (1.0879).
Yet, below current demand, the ground appears prepped for an approach to demand at 1.0526/1.0638, an area extended from March 2017.
H4 timeframe:
Partially altered from previous analysis -
Demand at 1.0889/1.0937, the decision point to break 1.1045 (glued to the top edge of daily demand at 1.0925/1.0864), made its second appearance in recent movement, though on this occasion testing the lower limits of the demand at 1.0902. On a positive note, the current candle is in the process of pencilling in a bullish outside pattern, smothering two previous candles and suggesting moves higher may be on the cards.
To the upside, aside from tops around 1.1039 and Friday’s high at 1.1147, supply at 1.1336/1.1272 is exposed, intersecting with a 78.6% Fib retracement at 1.1310. Supply around 1.1210ish appears fragile (arc pattern), with the majority of orders consumed.
H1 timeframe:
H4 demand underscored above at 1.0889/1.0937 entered view mid-way through US trade Wednesday, exhibiting a hammer candlestick pattern two points shy of the 1.09 handle. As we head into Asia, the runway appears reasonably free to approach 1.10, with a break immediately exposing the 100-period SMA around 1.1022 and then 1.1050. Traders will also note the RSI indicator established a bullish divergence signal, with the second trough bottoming ahead of oversold terrain.
The story on the US dollar index has price action trading from a daily resistance area at 100.03/99.37 after the buck advanced on haven demand, with little reaction seen in wake of the final Markit manufacturing and ISM surveys. Therefore, a drop from 100.03/99.37 today may aid EUR/USD buying.
Structures of Interest:
The rebound from H4 demand at 1.0889/1.0937 reflects a bullish climate as we head into Asia Pac hours today, particularly if H4 price closes in the shape of a bullish outside pattern. This – coupled with monthly and daily price testing demand – is likely sufficient to encourage an approach to 1.10, with a break targeting the 100-period SMA at 1.1022 and then 1.1050, followed by the 200-day SMA at 1.1077.
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