Weekly Timeframe: The Euro continued to lose value against the U.S Dollar last week, with weekly candle seen closing (1.26798) a few pips off its lows deep within a weekly (demand) ‘buy zone’ at 1.26591-1.28010. Assuming buying interest comes into the market here, the buyers will likely have to cross swords with active sellers from around a near-term weekly decision-point area seen at 1.29941-1.28583 before any higher prices can be seen. Alternatively, a close below would suggest to us that continuation selling may be seen down to around a combined weekly demand/Quasimodo support area at 1.22403-1.24420/1.22866.
Daily Timeframe: The daily timeframe shows Friday’s trading action closed just above a long-term daily demand swap area at 1.26229-1.26742. Considering price is trading deep within a weekly ‘buy zone’ (levels above) at the moment, it is very likely we may see some sort of bullish reaction here. With that being said, this pair looks like it has just nose-dived off of a cliff (more noticeable on the weekly timeframe), so we have to prepare ourselves for the possibility that this area will be consumed, and lower prices seen down to the next level of significance coming in at 1.25618, a daily decision-point level.
4hr Timeframe: At the time of writing, price is located within an ‘extreme’ 4hr demand area at 1.26591-1.26840. This area is extreme in our opinion because it remains to be the overall origin of a humongous rally that begun on the 13/11/12, making it an area traders were, and still are no doubt paying attention to! It is very likely a lot of buy orders have already been filled around the 1.26883 level, with the possibility that prices will rally up to at least the 4hr fresh supply area at 1.27597-1.27390. With that being said, a long trade here was a little risky in our view, since the 1.27 level (potential resistance) is looming over the 4hr demand area mentioned above like a big black cloud!
Assuming sellers are located around the 1.27 level; short orders are likely going to be filled around the 1.26962 area, since traders on this timeframe will be looking to play the retest of the 1.27 level in hope of this monster down trend continuing. On the assumption this happens, the selling pressure will very likely push prices below the aforementioned 4hr demand area filling potential buy orders around the 1.26554 level, just above a 4hr decision-point area seen at 1.26250-1.26504.
- Buy orders: 1.26554 (Predicative stop-loss orders seen at: 1.26200).
- Sell orders: 1.27350 (Predicative stop-loss orders seen at: 1.27646) 1.26962 (Predicative stop-loss orders seen at: 1.27070).
Weekly Timeframe: Similar to the Euro, the British pound also lost value against the U.S Dollar last week, as prices continue to plummet. Price closed (1.62387) below a weekly resistance flip level at 1.62591, suggesting continuation selling may ensue towards the weekly demand area seen at 1.58533-1.60157.
Daily Timeframe: A positive daily close below the 1.62503 level was seen on Friday. This move has potentially cleared the path down to the 1.61617 level (daily support), where we expect active buyers to be lingering.
4hr Timeframe: Things look much clearer to us on this timeframe. Price closed below an important ‘minor’ low marked with a blue arrow at 1.62391, which was not clear on the higher timeframes. This move essentially has cleared the way for price to fill buy orders that are likely set just above a combined 4hr demand/ round number area (1.61609/1.62057/1.62) at 1.62062 sometime this week.
With that being said though, before price hits this area, we have to be prepared for a retracement to happen to collect any unfilled sell orders that may be set either around the minor 4hr support flip level (1.62760) at 1.62710, or the nice-looking 4hr supply area seen just above (1.63405-1.63021) at 1.62931.
- Buy orders: 1.62062 (Predicative stop-loss orders seen at: 1.61530).
- Sell orders: 1.62710 (Predicative stop-loss orders seen at: 1.62911) 1.62931 (Predicative stop-loss orders seen at: 1.63489).
Weekly Timeframe: Over the past three weeks the Aussie Dollar looks as though it has just been pushed off of a cliff! The southbound move that was seen last week saw the weekly candle closing a few pips off its lows (0.87648), within an obvious-looking weekly demand area at 0.86591-0.88247, and as a result, buying interest should really be expected to come into the market sometime this week.
Daily Timeframe: Friday’s trading action saw price trade into the 0.87556 level (daily Quasimodo support). A slight bullish reaction was seen just before the market closed for the week (0.87648). Be that as it may, the only way to find out if this buying activity was legit, and not just traders liquidating some of their short positions, would be a follow-through to the upside early this week. Let’s take a look on at the 4hr timeframe price action to see if we can see any clues as to if prices will indeed rally.
4hr Timeframe: Some interesting price action has developed on the 4hr timeframe. There was clearly buying interest seen on Friday around the 4hr demand area at 0.87293-0.87578, it’s what happened after this, that was interesting. Check out the two wicks at 0.88019/0.87912, these were likely consumption wicks indicating a move higher is likely going to follow (effectively clearing out sellers). Ideally what we’d like to see is a small fakeout below the low 0.87467 early sometime this week, and from there on price will likely rally up to at least the 4hr support flip level at 0.88248 (sell orders seen just around the 0.88181 area).
With this recent price action seen on the 4hr timeframe, coupled with price currently located within higher-timeframe demand (Weekly: 0.86591-0.88247, Daily: 0.87556), we could be seeing the beginnings of a high-probability long trade forming.
- Buy orders: N/A – Awaiting a fakeout before any buy order can be initiated (Predicative stop-loss orders seen at: N/A).
- Sell orders: 0.88181 (Predicative stop-loss orders seen at: 0.88367).
Weekly Timeframe: The USD/JPY pair has rallied for three consecutive weeks, it was only until last week the buying onslaught seemed to take a breather, with price closing only 27 pips or so (109.265) above the previous week’s close at 108.995. In our opinion, weakness is currently being shown, and coupled with the fact that price is trading relatively deep within a weekly supply area (110.652-108.123) at the moment, we expect to see some sort of reaction south here this week.
Daily Timeframe: On this timeframe, it’s clear that last week’s trading action was range based (109.449/108.483) indicating possible indecision amongst the buyers and sellers. With that being said, the 108.421 level is proving to be strong support in the market with price seen testing it three times last week (108.241/108.448/108.467). Assuming buying interest comes into the market sometime this week, we may see the current uptrend continuing up to at least the 110.390 level (daily Quasimodo resistance), which would consequently push price extremely deep within the weekly supply area mentioned above. On the other hand, if we see a daily close below the 108.421 level, this will likely attract further selling down to a daily decision-point area at 106.799-107.108, and confirm selling strength from the aforementioned weekly supply area.
4hr Timeframe: The 4hr timeframe shows a magnified view of last week’s range (109.449/108.483) seen on the daily timeframe. A 4hr decision-point level (seen with a black arrow) at 108.445 was consumed on Tuesday (marked with a red circle below the range at 108.241), this move potentially cleared the path down to at least the 108 level.
A bearish pin-bar candle formed just before the close on Friday with the high breaking above the 109.449 level (top of the range). This could be a fakeout, and an indication we are in for lower prices this week, as we believe the signal to go south has already been shown (red circle – see above).
Either today or tomorrow will likely see a drop in value, no doubt filling buy orders just above the 109 level at 109.056. Assuming these buyers are weak, a further decline will be possibly seen down to the lower limits of the range (108.483), where there will very likely be more buy orders coming into the market from range traders around the 108.542 level, it is only when these buy orders are consumed, a drop down to the 108 level will be seen.
- Buy orders: 109.056 (Predicative stop-loss orders seen at: 108.799) 108.542 Predicative stop-loss orders seen at: 108.371).
- Sell orders: N/A (Predicative stop-loss orders seen at: N/A).
Weekly Timeframe: Last week saw the EUR/GBP pair close relatively deep within a weekly demand area (0.76931-0.78623) at 0.78055, as the sellers relentless assault continued. Could we see buying interest come into the market here, or is this area doomed to receive even more punishment?
Daily Timeframe: The daily timeframe shows a spike/tail (0.77840) was seen below the daily demand area at 0.77894-0.78271. This move has very likely cleared out a lot of buyers, and looks like a perfect fakeout for higher prices! With that being said, we have to be prepared for price to decline even further towards an extreme area of daily demand coming in at 0.77507-0.77772 before higher prices are seen. This area is extreme in our opinion because it remains to be the overall origin of a humongous rally that begun on the 23/07/12, making it an area well-funded traders are very likely paying attention to.
4hr Timeframe: Buy orders have already likely been filled just above the 4hr demand area (0.77675-0.77831) around the 0.77855 level. We have deliberately zoomed in on this chart to show price action up close and personal!
Sell orders seem to have been consumed around the decision-point level seen marked with a blue arrow at 0.78176, which likely indicates price is free to move up to the next set of sell orders seen just below the 4hr decision-point level (0.78311) at 0.78292.
For the time being, price appears to be standing strong above the 0.78 level (look at those two beautiful spikes/tails at 0.77985/0.78013), which in our opinion is all the buyers will likely need to propel price up to at least the 0.78311 level early this week.
- Buy orders: N/A (Predicative stop-loss orders seen at: N/A).
- Sell orders: 0.78292 (Predicative stop-loss orders seen at: 0.78399).
Weekly Timeframe: Last week saw the market close (1.11545) between a weekly decision-point support level at 1.08774, and a weekly Quasimodo resistance level at 1.12231. A break above here could potentially see prices trading up to the weekly supply area seen at 1.17225-1.15417; conversely, a break below the weekly decision-point support level could encourage follow-through selling down to around a very obvious weekly demand area seen at 1.05715-1.07008.
Daily Timeframe: A nice-looking break above daily supply (1.10980-1.10344) was seen on Thursday last week. This break indicates that the path may very well be clear up to at least the 1.11910 level (Quasimodo resistance), which is only 32 pips or so below the weekly Quasimodo resistance level (1.12231) mentioned above.
4hr Timeframe: Friday’s trading action saw price propel itself deep into a 4hr supply area seen at 1.11681-1.11392, which has likely filled a ton of sell orders in the process. A break above this area would very likely encourage further buying up to a combined fresh 4hr supply/round number area at 1.12096-1.11933/1.12 (beautifully lining up with the daily Quasimodo resistance level seen at 1.11910). Active sell orders will likely be filled en route around the 1.11892 area, where we highly expect a reaction to be seen.
Be that as it may, before higher prices are seen, a correction may be seen down towards the 1.11 level, at which point we fully expect active buy orders to come into the market around the 1.11107 area.
- Buy orders: 1.11107 (Predicative stop-loss orders seen at: 1.10869).
- Sell orders: 1.11892 (Predicative stop-loss orders seen at: 1.12122).
Weekly Timeframe: The Swiss France once again took a pounding, as the U.S Dollar rallied higher firmly closing above a weekly supply area seen at 0.94546-0.93081. This strong move will very likely attract further buying up to at least the next area of fresh weekly supply coming in at 0.97505-0.96494.
Daily Timeframe: It comes as no surprise to us that daily supply at 0.94546-0.93702 was also consumed last week as well, since this area was located deep within the aforementioned weekly supply that has already been destroyed! And, like the weekly timeframe analysis, if this buying onslaught continues, it is very likely that the fresh daily supply area above at 0.97505-0.96339 will be hit sometime soon. The only difference with the daily timeframe analysis, is that we can see if price corrects itself, it will likely do so down towards a daily decision-point area seen at 0.93522-0.93970.
4hr Timeframe: On Thursday last week, a spike/wick was seen penetrating the 0.95 level; we now know that this was to consume sellers for a potential move higher, since the following day saw prices close above this level, which in turn formed a higher high (0.95201), indicating potential buying strength for a rally up to around the 4hr demand flip area seen at 0.95452-0.95836 (active sell orders seen just below around the 0.95400 level).
However, before higher prices are seen, we will likely see a small decline in price to retest the 0.95 level, and fill any active unfilled buy orders in the process (0.95028). If the buying interest is recognized as being weak here, this will likely encourage further selling down to the next set of fresh buy orders sitting just above a 4hr demand area (0.94553-0.94680) at 0.94722.
- Buy orders: 0.95028 (Predicative stop-loss orders seen at: 0.94838) 0.94722 (Predicative stop-loss orders seen at: 0.94516).
- Sell orders: 0.95400 (Predicative stop-loss orders seen at: 0.95893).
Weekly Timeframe: The weekly timeframe shows there was not much trading action seen on gold last week. At the time of writing, price still remains confined between a weekly support flip level at 1244.08, and a weekly demand area seen below at 1156.70-1194.45.
Daily Timeframe: The daily timeframe shows that all price did last week was price meander between a daily decision-point supply area at 1241.95-1235.34, and a daily support flip level at 1211.67 last week, which, we are sure you’ll agree with, does not really give us a lot to go on!
4hr Timeframe: It appears a decision needs to be made on gold. The weekly, daily (1244.08/1156.70-1194.45…… 1241.95-1235.34/1211.67), and now the 4hr timeframe are all showing distinguishable ranges, with no clear direction in our opinion. The 4hr range is seen between the 4hr support level at 1211.12, and a 4hr resistance level at 1228.46. Check out the possible fakeouts either side of this range, this has very likely stopped a lot of traders out who place their stops too close to the range limits.
Nevertheless, there are still opportunities here to buy and sell the limits of this range with price action confirmation. We see potential opportunities to buy at 1212.17, and sell at 1227.67, again, please do wait for some sort of confirmation signal here, since this area could break at any time!
- Buy orders: 1212.17 (Predicative stop-loss orders seen at: Dependent on which price-action confirmation signal you use).
- Sell orders: 1227.67 (Predicative stop-loss orders seen at: Dependent on which price-action confirmation signal you use).