The chart levels and zones will be color coded for the benefit of readers as follows:

Weekly TF = Black. Daily TF = Gold. 4hr TF = Brown 

EUR/USD:

4hr TF.

Volatility has certainly picked up as price has shown more energy recently. We saw a rally into the 4hr demand/supply flip area at 1.36696 – 1.36432 as reported may happen. A minor demand area was formed on Monday at 1.36114 – 1.36186, this demand area could have been purposely created to facilitate a fakeout into the new 4hr demand area below at 1.35623 – 1.35984 with the round number 1.36000 just above providing extra support.

eurusdh4 chart 1

The chart below is more of a reminder to see what the 4hr demand area looks like to the left, and to show how close it is to the higher-timeframe daily demand area at 1.34770 – 1.35557.

eurusdh4 chart 2

  • Areas to watch for buy orders: 1.36114 – 1.36186, 1.36000, and 1.35623 – 1.35984.
  • Areas to watch for sell orders: 1.36696 – 1.36432.
  • Most likely scenario: Price will likely trade within the demand/supply flip area at 1.36696 – 1.36432 and the newly-formed minor demand area at 1.36114 – 1.36186, then likely fake this demand area into the new 4hr demand zone just below at 1.35623 – 1.35984, also taking a stab at the round number 1.36000 just above. Why would pro money do this? Think how many sell stops are just below the minor demand area (levels above) coupled with breakout sellers, this is a perfect opportunity to collect sell orders to buy in to, as don’t forget we are still within higher-timeframe weekly demand at 1.34770 – 1.36837.

 

GBP/USD:

4hr TF.

Some nice movement has been seen on this pair, with price consuming the majority of the sellers and stopping out the breakout buyers just above supply (1.68752 – 1.68558) as reported in yesterday’s analysis may likely happen. Price dropped like a rock to demand at 1.67835 – 1.68062, touching the daily demand uptrend line to the pip.

gbpusdh4

  • Areas to watch for buy orders: 1.67835 – 1.68062, 1.68000.
  • Areas to watch for sell orders: 1.69000.
  • Most likely scenario: With the majority of sellers/breakout buyers at supply (1.68752 – 1.68558) consumed, price is free to hit the next supply area which will likely be the round number 1.69000 just above. Pro money will likely trade off of the demand area near where price is currently trading, at 1.67835 – 1.68062, but not before spiking lower to consume the sell stops and the breakout sellers’ orders around the round number 1.68000 to buy into for a possible rally to the upside.

AUD/USD:

4hr TF.

This pair has seen a lot more action compared to recent trading sessions. It was reported in the last analysis, price will likely break the lower 4hr demand area at 0.92037 – 0.92203, but also forewarning us that we may see a spike to supply at 0.92745 – 0.92570 beforehand.

A spike to supply did happen, which actually broke the upper limit, consuming the majority of the sellers and stopping out the bullish breakout traders.

Keeping in mind from the last analysis:

  •  If a break lower happens, price has very little to stop it from reaching the 4hr decision point (demand) at 0.91542 – 0.91741 with the daily S/R flip level just below at 0.91446.
  • If a break above happens, there’s little in the way to stop buyers pushing price up to the minor demand/supply flip area at 0.93345 – 0.93186.

audusdh4

  • Areas to watch for buy orders:  0.91542 – 0.91741, 0.91446 (Daily S/R flip level)
  • Areas to watch for sell orders: 0.92745 – 0.92570.
  • Most likely scenario: At the time of writing, price still remains capped between supply (0.92745 – 0.92576) and demand at 0.92037 – 0.92203. Still, considering the following: we have seen a recent bearish reaction off of the weekly S/R flip area (0.93718), along with the daily timeframe being in a weak-looking demand area at 0.92054 – 0.92649, the 4hr chart will likely see price break the lower demand area (0.92037 – 0.92203) along with the round number 0.92000 dropping towards the decision point/demand area at 0.91542 – 0.91741, with the daily S/R flip level just below at 0.91446.

USD/JPY:

4hr TF.

This pair has not really moved much considering more volatility was expected yesterday. A few more minor tests north have been seen at the round number 102.000, but with no bearish conviction. Another tail has been circled, why would this tail be any different to the previous two? Remembering that it was reported  the previous two tails were likely buying tails i.e. consuming buyers on the way up, potentially clearing the way south. Now, considering price is currently trading at round number resistance (levels above), the tail may be an indication of more buying near a supply (the round number) giving us the indication we may likely see a break of the round number north, testing the next supply area above at 102.365 – 102.128, as this could well be pro money loading the boat for a push up.

usdjpyh4

  • Areas to watch for buy orders:  101.335 – 101.472.
  •  Areas to watch for sell orders: 102.000, 102.365 – 102.128.
  • Most likely scenario: Price will likely break the round number 102.000, forcing price to test the nest supply area at 102.365 – 102.128. If, in the unlikely event price does drop, look for buyers to come into the market around the demand area below at 101.335 – 101.472.