Interesting P.A being seen on the EUR at the moment
The bullish pulse continues to beat in the EUR/USD market this morning, with the pair recording its second consecutive advance yesterday. Consequent to this, H4 price breached the upper edge of a bullish pennant (1.1075/1.1268) and the 1.12 handle, and managed to reach a high of 1.1252 on the day. Over on the bigger picture, we can see that weekly price has drawn closer to the lower edge of a long-term supply coming in at 1.1278. Daily action on the other hand, shows that the candles are trading within touching distance of a daily supply that’s not only glued to the underside of the said weekly zone at 1.1327-1.1253, but also intersects with a daily trendline resistance etched from the low 1.0711.
Technically speaking, there’s equal opportunity to trade this unit both long and short today.
• For longs, we’re looking at a retest of 1.12 since it converges with the recently breached H4 pennant edge taken from a high of 1.1268 and a H4 38.2% Fib support at 1.1198 (drawn from the low at 1.1109 – green circle).
• For shorts, the H4 resistance at 1.1279 and 1.13 handle is a reasonable area to consider selling from, given its relationship with the two aforementioned higher-timeframe supplies.
Our suggestions: While there’s scope for both a long and a short today, we favor the sell side of this market right now. With daily price trading so close to supply that has connections with a weekly supply, we feel it’s just too risky to buy this market from1.12, despite its neighboring confluence.
With that in mind, our main focus turns to 1.13/1.1279. Ultimately, we’d need a reasonably sized H4 bearish candle to form here, preferably a full-bodied candle, before pulling the sell trigger. This will help avoid getting stopped on a fakeout and inform us that seller interest exists.
Data points to consider: US ADP non-farm employment change at 1.15pm, US weekly unemployment claims at 1.30pm and US ISM Manufacturing PMI figures at 3pm GMT+1.
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: 1.13/1.1279 (waiting for a reasonably sized H4 bear candle – preferably a full-bodied candle – to form before pulling the trigger is advised, stop loss: ideally beyond the candle’s wick).
Technically speaking, there’s equal opportunity to trade this unit both long and short today.
• For longs, we’re looking at a retest of 1.12 since it converges with the recently breached H4 pennant edge taken from a high of 1.1268 and a H4 38.2% Fib support at 1.1198 (drawn from the low at 1.1109 – green circle).
• For shorts, the H4 resistance at 1.1279 and 1.13 handle is a reasonable area to consider selling from, given its relationship with the two aforementioned higher-timeframe supplies.
Our suggestions: While there’s scope for both a long and a short today, we favor the sell side of this market right now. With daily price trading so close to supply that has connections with a weekly supply, we feel it’s just too risky to buy this market from1.12, despite its neighboring confluence.
With that in mind, our main focus turns to 1.13/1.1279. Ultimately, we’d need a reasonably sized H4 bearish candle to form here, preferably a full-bodied candle, before pulling the sell trigger. This will help avoid getting stopped on a fakeout and inform us that seller interest exists.
Data points to consider: US ADP non-farm employment change at 1.15pm, US weekly unemployment claims at 1.30pm and US ISM Manufacturing PMI figures at 3pm GMT+1.
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: 1.13/1.1279 (waiting for a reasonably sized H4 bear candle – preferably a full-bodied candle – to form before pulling the trigger is advised, stop loss: ideally beyond the candle’s wick).
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