Interesting P.A being seen on the EUR this morning...
Going into the early hours of yesterday’s US segment, H4 price cleared the 1.09 handle on lower-than-expected US consumer confidence and ended the day touching gloves with mid-level resistance at 1.0950. While the bulls certainly appear in fine form this morning, traders may want to take into account that not only is 1.0950 now in play, but twenty or so pips above here there’s a daily resistance sitting at 1.0971 (converges with a trendline resistance taken from the high 1.0828 and an AB=CD completion point at 1.0980 [black arrows]). What is strongly favoring the bulls at the moment, however, is weekly price. Notice how the week’s open forced the unit above resistance at 1.0819 and the 2016 yearly opening level at 1.0873, which are both currently being used as support.
Our suggestions: Based on the above structure, we see three possible trade scenarios:
1. Look to buy the couple on any retest seen at 1.09. There’s not much H4 confluence seen here though, so waiting for additional confirmation is advised (a reasonably sized H4 bull candle should suffice – preferably a full-bodied candle).
2. Wait and see if the daily bulls can close price above the current daily resistance. Should this come to fruition, one could then look to trade any retest seen thereafter.
3. Go against the grain and consider shorting from 1.0971, given the daily confluence seen at the daily resistance level. To be on the safe side, we would personally wait for a H4 bear candle (preferably a full-bodied close) to form before committing, since ending up on the wrong side of weekly flow would not be pleasant.
Data points to consider: No high-impacting economic events.
Our suggestions: Based on the above structure, we see three possible trade scenarios:
1. Look to buy the couple on any retest seen at 1.09. There’s not much H4 confluence seen here though, so waiting for additional confirmation is advised (a reasonably sized H4 bull candle should suffice – preferably a full-bodied candle).
2. Wait and see if the daily bulls can close price above the current daily resistance. Should this come to fruition, one could then look to trade any retest seen thereafter.
3. Go against the grain and consider shorting from 1.0971, given the daily confluence seen at the daily resistance level. To be on the safe side, we would personally wait for a H4 bear candle (preferably a full-bodied close) to form before committing, since ending up on the wrong side of weekly flow would not be pleasant.
Data points to consider: No high-impacting economic events.
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