Looking for shorts around 1.13/1.1279...
Weekly gain/loss: + 102 pips
Weekly closing price: 1.1280
Thanks to last week’s push to the upside (which for all you candle enthusiasts out there, formed a bullish engulfing candle) weekly supply at 1.1533-1.1278 is now in play. The zone has also managed to cap upside since May 2015, so it’s not a base one should overlook!
Glued to the underside of the said weekly supply area is a daily supply zone visible at 1.1327-1.1253, which happens to intersect with a daily trendline resistance etched from the low 1.0711. Although Friday’s candle pushed higher into this zone, shaped by a near-full-bodied bullish candle, it deserves respect since it has held the unit lower since mid-September 2016.
Friday’s disappointing US employment report saw the EUR/USD increase in value as the US dollar took a hit, clocking a low of 96.72. Payroll numbers revealed the US economy added 138k jobs in May, missing market consensus at 185k. The unemployment rate came in slightly above expectations at 4.3%, while average hourly earnings came in as expected at 0.2%.
While we agree the bulls do look in fine form on the H4 chart, following the recent bounce off the trendline support etched from the high 1.1267 (shadowed closely by the 1.12 handle), there may trouble lurking ahead. Thanks to Friday’s advance, we are now seeing price test resistance coming in at 1.1279, which is followed closely by the large psychological band 1.30. Combined, these two levels are of interest to our desk.
Our suggestions: Due to the said H4 zone marked in green forming within the above noted higher-timeframe supplies, we’re keen to short from this area. However though, we would need to see a reasonably sized H4 bearish candle form here, preferably a full-bodied candle, before pulling the sell trigger. This is mainly because we feel price may look to challenge 1.30 and possibly whipsaw above it before serious sellers step in. Should this trade come to fruition, our first take-profit zone will be the mid-level support pegged at 1.1250.
Data points to consider: US ISM Non-manufacturing PMI 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).
Weekly closing price: 1.1280
Thanks to last week’s push to the upside (which for all you candle enthusiasts out there, formed a bullish engulfing candle) weekly supply at 1.1533-1.1278 is now in play. The zone has also managed to cap upside since May 2015, so it’s not a base one should overlook!
Glued to the underside of the said weekly supply area is a daily supply zone visible at 1.1327-1.1253, which happens to intersect with a daily trendline resistance etched from the low 1.0711. Although Friday’s candle pushed higher into this zone, shaped by a near-full-bodied bullish candle, it deserves respect since it has held the unit lower since mid-September 2016.
Friday’s disappointing US employment report saw the EUR/USD increase in value as the US dollar took a hit, clocking a low of 96.72. Payroll numbers revealed the US economy added 138k jobs in May, missing market consensus at 185k. The unemployment rate came in slightly above expectations at 4.3%, while average hourly earnings came in as expected at 0.2%.
While we agree the bulls do look in fine form on the H4 chart, following the recent bounce off the trendline support etched from the high 1.1267 (shadowed closely by the 1.12 handle), there may trouble lurking ahead. Thanks to Friday’s advance, we are now seeing price test resistance coming in at 1.1279, which is followed closely by the large psychological band 1.30. Combined, these two levels are of interest to our desk.
Our suggestions: Due to the said H4 zone marked in green forming within the above noted higher-timeframe supplies, we’re keen to short from this area. However though, we would need to see a reasonably sized H4 bearish candle form here, preferably a full-bodied candle, before pulling the sell trigger. This is mainly because we feel price may look to challenge 1.30 and possibly whipsaw above it before serious sellers step in. Should this trade come to fruition, our first take-profit zone will be the mid-level support pegged at 1.1250.
Data points to consider: US ISM Non-manufacturing PMI 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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