EUR/USD:

Weekly Timeframe: Last week was clearly a successful one for the buyers with sellers showing little to no interest. The market moved a respectable 247 pips from a nice-looking weekly Quasimodo support area at 1.22403-1.22942, forcing the market to close at 1.24594 just below a minor weekly swap level coming in at 1.24996. Let’s see what the lower timeframes have to say.

WKLY

Daily Timeframe: The daily timeframe shows that the EUR/USD rallied four days out of five last week. Sellers started showing some enthusiasm on Thursday deep within a daily supply area seen at 1.25056-1.24180 (located just below the aforementioned minor weekly swap level). However, the buyers snapped back control on Friday and closed prices deeper within the aforementioned daily supply area. Assuming that a break above here is seen this week, we could effectively see further buying up to a partially consumed daily supply area at 1.26386-1.25459, which incidentally encapsulates a major weekly swap level at 1.25816.

DLY

4hr Timeframe: Following on from Friday’s analysis, the Euro did indeed rally once more from the 4hr demand area seen at 1.23610-1.23918, and came within a few pips of hitting the 4hr Quasimodo resistance level (green line) at 1.24892.

If selling interest is seen early on today or even tomorrow, this pair would in our opinion be range bound between the 4hr levels mentioned above. We’d rather be a seller within this range simply because the higher-timeframe picture shows price is trading around supply/resistance (see above) at the moment. Selling here with a pending order would be too risky for our liking; waiting for lower-timeframe selling confirmation around 1.28487 would for us be the best path to take since a fakeout above to 1.25 is very possible.

With that being said, in the event a close above 1.25 is seen, this will likely force the market to test a smashing-looking 4hr supply area seen at 1.25671-1.25336, located within daily supply at 1.26386-1.25459. This could be a nice place to look for shorts if/when price reaches here. On the other hand, if the sellers make a dive for the aforementioned 4hr demand area, and break below it, this could potentially force the market back down to the weekly Quasimodo support area mentioned above, as this is (as we see it) the only barrier of defense the Euro has that could stop a decline such as this from happening. We are very much looking forward to seeing how the market behaves over the next few days.

4hr

Current buy/sell levels:

  • Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
  • Sell orders: 1.28487 [Tentative] (Predicative stop-loss orders seen at: 1.25108).

GBP/USD:

Weekly Timeframe: The weekly timeframe shows that after four weeks of pathetic bullish action being seen around a weekly demand area at 1.54260-1.56110, buying strength was finally seen last week as the market closed (1.57144)  just below a weekly swap level coming in at 1.57166. The only way for the pound to continue north in our opinion would be to take out any selling opposition around this level, which as a result would likely clear the path north up to 1.58934, another weekly swap level.

WKLY

Daily Timeframe: The daily timeframe shows that there was essentially very little bearish activity last week as prices rallied from a daily demand area seen at 1.54260-1.55378 (located relatively deep within the aforementioned weekly demand area).

With that being said, indecision was seen around 1.57166 (weekly swap level) during Thursday and Friday’s trading sessions. In the event that the buyers convincingly close price above this level, we are confident that follow-through buying will ensue towards a daily supply area seen at 1.59438-1.58338 (surrounds the weekly swap level 1.58934). It will be interesting to see what the 4hr timeframe picture looks like.

DLY

4hr Timeframe: The indecision talked about in the daily timeframe analysis is seen clearer on the 4hr timeframe. Check out Friday’s trading session, we feel bad for anyone who got caught within this small consolidation seen between a 4hr supply area at 1.57629-1.57334, and the round-number level 1.57. If a breakout north is seen early on this week, we could potentially see the market test a 4hr supply area seen at 1.58389-1.58103 (located just below the daily supply area at 1.59438-1.58338). We would consider entering short here (1.58044), but only with lower-timeframe confirmation due to this area likely being weak as it has been visited (1.58247 – 27/11/14) once already. A break south on the other hand would likely force the market towards a minor 4hr demand area coming in at 1.56511-1.56667. Risk/reward considerations nonetheless argue against entering long here with prices so close to potential resistance (1.57).

4HR

Current buy/sell levels:

  • Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
  • Sell orders: 1.58044 [Tentative] (Predicative stop-loss orders seen at: 1.58474).

AUD/USD:

Weekly Timeframe: The AUD/USD has seen a decline in value for four consecutive weeks now. This has consequently forced prices deep within a major weekly demand area coming in at 0.80646-0.84601.  Last week’s action shows that price closed below a long-term channel support, which in our opinion is not a good sign for anyone who is currently long Aussie at the moment. Let’s take a look at the lower timeframes to see what we can find.

WKLY

Daily Timeframe: Last week shows that the buyers and sellers were seen battling for position just above a daily demand area seen at 0.80809-0.82270. In all honesty though, the buying interest shown here is not exactly convincing from where we’re standing. The only way to find out if the buying was indeed legit and not just traders short covering would be a follow-through to the upside, preferably above the high 0.83743.

DLY

4hr Timeframe: The 4hr timeframe shows that the market is effectively capped between 0.82230, and 0.83. A break above 0.83 sometime this week could allow us to take a long position on a potential retest around the 0.83049 mark. Entering long here would require some sort of lower-timeframe confirmation, since psychological levels such as these are sometimes prone to deep tests/spikes. Our first take-profit target will be set at 0.83639, just below a 4hr supply area seen at 0.83894-0.89676. The reason why we’d not take full profits here is simply due to the fact that price is – even with the recent decline in value, still trading around heavy higher-timeframe demand (see above) at the moment, essentially meaning higher prices could well be seen.

A break below 0.82230 on the other hand would immediately see prices trading around 0.82, which could very likely trigger some buying interest. However, we would only consider buying here once/if a close is seen above the 0.82230 hurdle.

4hr

Current buy/sell levels:

  • Buy orders: 0.83049 [Tentative] (Predicative stop-loss orders seen at: Dependent on where this level is confirmed).
  • Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

USD/JPY:

Weekly Timeframe: After seven consecutive weeks of relentless buying, the USD/JPY pair finally saw some selling interest. Price sold off from just below a weekly Quasimodo resistance level seen at 122.180 for a whopping 440pips! This move consequently forced prices down towards a weekly swap area coming in at 117.931-116.799, where a little buying activity was seen before the market closed (118.765) for the week.

WKLY

Daily Timeframe: The reason for the recent buying interest likely stems from a small daily demand area seen at 117.225-117.873 (located within the aforementioned weekly swap area). If further buying is seen from here, there is very little in our opinion stopping prices from rallying back up towards the daily supply area coming in at 122.610-121.540 (encapsulates the aforementioned weekly Quasimodo resistance level).

DLY

4hr Timeframe: It was mentioned in the previous analysis that our bias for this pair is long, which still remains to be the case. We also noted that we were going to be looking for confirmed buying opportunities around the combined 4hr demand/round number area at 117.844-118.212/118.  An average buy signal was seen on the 15 minute timeframe and the market filled us at 118.240 on Friday around 16.45pm GMT time. We only entered half of our normal trading position since we do not like leaving capital exposed over the weekend.

Our overall take-profit target for this trade is set at 120.591, just below a 4hr supply area seen at 120.992-120.668. However, we’re expecting a bit of a roller coaster ride with plenty of bumps along the way before our target is hit, as per the red arrows on the chart.

4hr

Current buy/sell levels:

  • Buy orders: 118.240 [LIVE] (Predicative stop-loss orders seen at: 117.751).
  • Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

USD/CAD:

Weekly Timeframe: Last week saw the USD strengthen against the CAD consequently forcing the market to close (1.15736) around a weekly supply area coming in at 1.17225-1.15417 (located within a larger weekly supply area seen at 1.18061-1.14739). Let’s see what the lower timeframes have to say about this.

WKLY

Daily Timeframe: It was reported in Friday’s analysis that price had closed above a major daily swap level coming in at 1.14861 on Thursday, which informed us that higher prices would likely follow. And as we can all see further buying was indeed seen slightly closing above a channel resistance. We feel that there is a good chance a continuation move will be seen today and possibly into tomorrow towards a daily supply area coming in at 1.17225-1.16182 (located deep within the weekly supply area mentioned above at 1.17225-1.15417), before we see any serious selling activity.

DLY

4hr Timeframe: Unfortunately, Due to lack of historical data, we’re unable to see what the 4hr price action is like in the past. We don’t feel that this will hinder our analysis though since we know where we are located in the bigger picture.

The 4hr timeframe shows that price is trading around a channel resistance at the moment, and with the psychological level 1.16 looming just above, a correction may be seen before prices reach the aforementioned daily supply area.

With all of the above taken into consideration, we feel there is a good chance the following will take place this week:

  • Price will rally towards 1.16.
  • A bearish reaction will likely be seen, where one could potentially enter short here around the 1.15968 mark for a bounce trade – lower-timeframe confirmation is recommended.
  • Assuming 1, and 2 happen, a large amount of traders will see red candles on the 4hr chart and enter short believing that a big move south is on the cards, and they could be right since price is currently seen dancing around weekly supply (see above) at the moment.
  • We however feel there is a good chance that once a reaction is seen there, and a ton of traders are short the market expecting it to drop forever, pro money will cause confusion by buying into all these sells and push prices up to the aforementioned daily supply area, which is where we believe an overall larger move south will be seen.

4hr

Current buy/sell levels:

  • Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
  • Sell orders: 1.15968 [Tentative] (Predicative stop-loss orders seen at: Dependent on where one confirms the level).

DAX 30:

Weekly Timeframe: Last week saw the DAX drop 534 points from 10082. In the event that further selling is seen this week, prices will likely hit a weekly decision-point demand area seen at 9126-9467. Let’s see what we can find on the lower timeframes.

WKLY

Daily Timeframe: The DAX sold off relatively aggressive on Friday, dropping a respectable 261 points (this figure includes per/after-market hours).  Similar to the weekly timeframe – the daily timeframe shows that if further selling is seen today, prices will hit a daily decision-point demand area coming in at 9381-9524 (located just within the aforementioned weekly demand area).

DLY

4hr Timeframe: As mentioned in Friday’s analysis, we felt that there was a good chance a decline in value was going to be seen. That being said though, we did expect more of a fight from the 4hr demand area seen at 9683-9735. Once price broke below this area, we were quite confident prices would drop, due to the clear liquidity gap seen to the left.

We believe there is very little to stop the DAX from dropping lower during today’s trading sessions. Granted prices will likely see a bounce from 9524 (top limit of the daily decision-point demand area), but prices will in our opinion continue lower towards a fresh 4hr demand area coming in at  9381-9431 (located deep within both the weekly/daily decision-point demand areas – see above). This area is begging to be traded long! We have placed a pending buy order a little above at 9440, with a stop set below at 9371.

4hr

Current buy/sell levels:

  • Buy orders: 9440 (Predicative stop-loss orders seen at: 9371).
  • Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

DOW 30:

Weekly Timeframe: Last week was clearly one for the sellers as the market dropped an overall 711 points, and engulfed five previous weekly candles in the process. Providing that the sellers keep up with this newly-found enthusiasm, it is very likely we will see the market test an ignored weekly Quasimodo level at 17135 sometime this week.

WKLY

Daily Timeframe: For anyone who entered long around the daily decision-point demand area seen at 17281-17427 would likely have been left with very little choice but to cover their position. At the time of writing, it appears that the path south is clear down towards the aforementioned ignored weekly Quasimodo level. However, a little below this area lurks a daily decision-point demand area coming in at 16895-16997, which could provide pro money a nice area to fake in to (as per the blue arrows). Let’s see what we can find on the 4hr timeframe.

DLY

4hr Timeframe: The 4hr timeframe shows some very interesting price action. However, before we get into that, let’s just quickly recap so we’re all on the same page.

The weekly timeframe shows that price is trading just above an ignored weekly Quasimodo level, while the daily timeframe is informing us that a fakeout may be seen at this Quasimodo level down to a daily decision-point demand area (for levels  – see above). The 4hr timeframe on the other hand shows that we may see a reversal before price hits the ignored weekly Quasimodo level. Check out the 4hr decision-point demand area at 17177-17225, notice that this area holds weight as it was likely here that pro money made the decision to break above the high 17362 (seen clearer on the daily timeframe), which means there could indeed be unfilled buy orders remaining here. We intend to watch for lower-timeframe buying confirmation around the 17238 mark during today’s trading sessions. We would usually place a pending buy order at areas such as this, but we feel there is a good chance that price will fake below to the weekly ignored Quasimodo level. In addition to this, we also have to keep in mind that the daily timeframe analysis indicates that price could indeed continue much lower towards the aforementioned daily decision-point demand area before higher prices are seen, so tight trade management is required on all trades taken on the DOW for the time being.

4hr

Current buy/sell levels:

  • Buy orders: 17238 [Tentative] (Predicative stop-loss orders seen at: Dependent on where one confirms this area).
  • Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

XAU/USD (Gold):

Weekly Timeframe: The rebound from the weekly decision-point demand level seen at 1136.30 extended higher recently, forcing Gold to close (1222.20) a few pips below a weekly supply area coming in at 1255.20-1226.18. It will be interesting to see what the lower timeframes show.

WKLY

Daily Timeframe: The daily timeframe shows that apart from Monday and Tuesday, the Gold market was relatively quiet. Tuesday saw price push above a daily decision-point supply area at 1235.51-1222.37, which in our view signaled Gold wants to trade higher into the aforementioned weekly supply area. With this in mind, we feel that the path north is relatively clear up towards a daily Quasimodo resistance level coming in at 1249.45, seen very deep within the aforementioned weekly supply area. Could we see a decline in value down towards a daily decision-point demand area at 1185.97-1203.20 before the market attempts to trade to 1249.45? Let’s see what the 4hr timeframe can offer us. 

DLY

4hr Timeframe:  The 4hr timeframe shows that from Wednesday through to Friday, the market was seen grinding (pink trendline) south after consuming sellers around a minor 4hr swap level at 1235.40. This consequently saw Gold push below a 4hr swap area seen at 1221.13-1215.21 marked with a blue arrow. And as a consequence, stops were likely triggered from traders attempting to fade this area, which at the same time potentially cleared the path south down towards a 4hr decision-point demand area coming in at 1199.48-1205.02 (located just within the aforementioned daily decision-point demand area).

In our opinion, the most likely scenario for this week is that prices will likely continue to decline down towards the 4hr decision-point demand area mentioned above, and from there we anticipate a rally higher towards a 4hr supply area seen at 1244.52-1240.15.  A small reaction is expected here, but overall we see prices breaking above here into the aforementioned daily Quasimodo resistance level (see red arrows), which if you remember is seen deep within weekly supply at 1255.20-1226.18 – a perfect area to look for shorts!

We have placed a pending buy order at 1205.88, with our stop set below at 1198.73, in an attempt to take advantage of the potential move north.

4hr

Current buy/sell levels:

  • Buy orders: 1205.88 (Predicative stop-loss orders seen at: 1198.73).
  • Sell orders: Flat (Predicative stop-loss orders seen at: N/A).