The charts levels and zones will be color coded for the benefit of readers as follows:
Weekly TF = Black. Daily TF = Gold. 4hr TF = Brown
In the last analysis, it was said traders should be aware that price may likely fakeout above supply (1) at 1.37309 – 1.36890 to the demand/supply flip area just above at 1.37487 – 1.37374. This nearly happened to the pip just missing the D/S flip area by about 3 pips or so,
Unfortunately, price still remains capped between the supply area just mentioned above at 1.37309 – 1.36890, and demand at 1.36434 – 1.36696, as we have yet to see a positive close either above supply or below demand. Once this close does happen, we’ll have an answer as to whether the black circled area was in actual fact a genuine break of daily demand at 1.36727 – 1.37313 or just a fakeout to push prices higher.
- Areas to watch for buy orders: 1.36434 – 1.36696.
- Areas to watch for sell orders: 1.37309 – 1.36890, 1.37487 – 1.37374.
- Most likely scenario: Price is currently seen trading at the round number 1.37000, right in the middle of where price is capped (supply 1.37309 – 1.36890 and demand (1.36434 – 1.36696). Either supply or demand can be tested from where price is currently trading at, not forgetting the possibility of another fakeout above supply (levels above) to the demand/supply flip area at 1.37487 – 1.37374, so trades on the lower timeframes around the cap limits may present low-risk, high-reward opportunities, but remain aware a positive break may happen at any time, especially with the FOMC meeting at 6pm GMT later today.
Price did exactly as expected; buyers clearly did run out of opposing traders to sell to at the high: 1.68383. Sellers brought price back to the demand area below at 1.67835 – 1.68062, but this time trading deeper within the zone towards the round number 1.68000 where near-term buyers were waiting. Price then took off north, just missing the supply area that’s currently capping price at 1.68824 – 1.68714 by around 6 pips.
- Areas to watch for buy orders: 1. 67835 – 1.68062, 1.68000.
- Areas to watch for sell orders: 1.68824 – 1.68714.
- Most likely scenario: The last weekly analysis on Monday showed that price on the weekly timeframe recently broke above long-term consolidation at 1.67980 – 1.42273 and is currently retesting the top as support. The daily timeframe showed support was seen at around the low of 1.67622. Right now on the 4hr timeframe, price is trapped/capped between supply at 1.68824 – 1.68714 and demand at 1.67835 – 1.68062. Taking all the above on board, price is likely to rally higher today, with the possibility of breaking the 4hr supply area just mentioned. For this to happen, price will need to positively close above the high 1.68383 to reach this supply zone, however, do remain aware that sellers may still be active around this supply area (levels above).
The sellers were on fire yesterday, and certainly took no prisoners! The minor demand area at 0.93186 – 0.93345 was completely consumed, and is now a supply area worth watching for future trading opportunities. At the time of writing, the sellers seem to be consuming the 4hr demand area noted to watch yesterday at 0.92570 – 0.92745, which is also the upper limit of a daily demand area at 0.92054 – 0.92649, as a result, a retracement may be possible.
New areas added:
- Supply area: 0.93729 – 0.93592.
- Demand area: (bottom of daily demand) 0.92037 – 0.92203.
- Areas to watch for buy orders: Daily demand (0.92054 – 0.92649), 0.92037 – 0.92203.
- Areas to watch for sell orders: 0.93186 – 0.93345, 0.93729 – 0.93592, 0.93000.
- Most likely scenario: Price will likely see a retracement here due to price entering daily demand at 0.92054 – 0.92649 as mentioned above, and also traders who were short from above using this area to liquidate their positions. Sellers are likely to be seen in and around the minor demand/supply flip area and the newly-formed supply area above (0.93186 – 0.93345….0.93729 – 0.93592), but do not discount the possibility of a reaction at the round number 0.93000 just below these areas. Be that as it may, do keep a close eye on the demand area below at 0.92037 – 0.92203 for a possible spike down during the FOMC announcement today.
On the daily timeframe , we can see price is yet to make a positive close below daily demand and the lower (buffer) trendline (101.207 – 101 – 754) marked with a gold x sign.
Price, as reported did react around the area of the broken trendline acting as resistance, but has not yet visited the fakeout zone below at 100.927/101.000. If we saw price close above the high (black circle) 101.674, this may confirm that price breaking the daily demand area at 101.207 – 101.754 was in fact a fakeout, but only time will tell.
- Areas to watch for buy orders: 100.927/101.000.
- Areas to watch for sell orders: 101.674.
- Most likely scenario: Price is in a very difficult area on the chart to give an accurate likely scenario, because we don’t at this point in time have much to go on concerning possible direction, due to price currently trading in and around a weak daily demand area at 100.207 – 101.754. For the fakeout (marked with a green circle) below the daily demand area to be confirmed, we need to see the high of 101.674 be consumed, if that’s the case, pro money may use the possible fakeout area below (labeled on the chart) at 100.927/101.000 for a rally. Nonetheless, if price consumes the fakeout area just mentioned with a positive close below, this will tell us that the daily demand area has been well and truly consumed, thus lower prices will be expected.