EUR/USD:

Weekly Timeframe: Current trading action on the weekly timeframe shows buying interesting coming from a weekly Quasimodo support level at 1.1109. To the upside, we see potential resistance coming from a weekly supply area at 1.1678-1.1458.

Daily Timeframe: Yesterday’s action saw the buyers rebound strongly from a fresh daily demand area coming in at 1.1045-1.1127 (encapsulates the aforementioned weekly Quasimodo support level). Provided that the buyers can hold out here, we may see prices test a long-term daily swap level at 1.1378, a daily swap.

4hr Timeframe: Recent developments on the 4hr timeframe reveal that the EUR/USD started the week negatively as prices gapped south below the 1.1200 handle. Despite this, the pair found 1.1100 to be supportive enough to allow the buyers back into play, which in turn saw the market fill the weekend gap and rally nearly 200 pips towards the 1.1300 barrier.

Given the points made above, price is in a great position to be looking for buy trades at the moment (see above). However, with the current state the Eurozone is in at the moment and the fact that price is lingering just below a 4hr supply area at 1.1368-1.1313, no buy trades will be initiated just yet.

With regards to selling this pair, we usually avoid shorting into higher-timeframe structures as it firmly goes against our conservative trading nature. However, we will be keeping a close eye on the 1.1300 area for any buying weakness that we could take advantage of, as this level (in our opinion) remains a decisive juncture for the Euro.

4HR

Current buy/sell levels:

  • Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
  • Sell orders: watching for lower-timeframe confirmation around the 1.1300 area (Predicative stop-loss orders seen at: dependent on where one confirms this level).

 

GBP/USD:

Weekly Timeframe: Current action on the weekly timeframe shows buying interest entering the market within a major weekly demand area at 1.4812-1.5097. Traders should refrain from getting too excited though, as the buyers still need to overcome any selling opposition located around the underside of a recently broken trendline formed from the low 1.4225 (17/05/14).

Daily Timeframe: The recent buying interest seen on the weekly timeframe was likely induced from a daily demand area at 1.4812-1.4949 (located deep within the aforementioned weekly demand area). From a technical standpoint, this area of demand is rather significant since it is effectively the last line of defense for the current weekly demand area. In addition to this, it is also the origin of a year-long uptrend beginning on the 10/07/13. For anyone currently long this pair, potential resistance is seen above in the form of a daily supply area coming in at 1.5211-1.5140.

4hr Timeframe: The 4hr timeframe shows that the market opened at 1.5009, which saw hesitation around 1.5000, before eventually rocketing north towards 1.5100.

For lack of a better word, we feel ‘trapped’ with this pair, trapped in the sense that short/medium-term direction is relatively unclear from a technical perspective. On the on hand, buying seems more favorable owing to the fact that price is currently trading within major weekly demand (see above) at the moment. However, if one were to buy the GBP, they would effectively be buying into potential resistance seen from the recently broken weekly trendline level, and not forgetting the daily supply area mentioned above at 1.5211-1.5140.  So, under the above circumstances, we’ve opted to stand on the sidelines until more conducive price action presents itself.

4hr

Current buy/sell levels:

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

 

AUD/USD:

Weekly Timeframe: The weekly timeframe currently shows the buyers and sellers battling for position within a major weekly demand area coming in at 0.7699-0.7974.

Daily Timeframe: Yesterday’s trading action saw buying interest entering the market just above a daily Quasimodo support area seen at 0.7699-0.7834 (seen deep within the aforementioned weekly demand area). Assuming that the buyers continue to accelerate here, we will likely see prices test a small, yet likely powerful daily supply area at 0.8050-0.7994.

4hr Timeframe: The AUD/USD started the week negatively with price gapping south below the 0.7900 handle. It was not too long though before the pair found support just above the mid-number 0.7850 at 0.7856, which consequently allowed the buyers back into play. Further buying then ensued, breaking back above 0.7900, where price is currently seen consolidating.

From a technical standpoint, buying this pair is far more favorable than selling at the moment. If one were to sell this pair, granted, you would be selling with the overall trend, but you would also be selling into higher-timeframe weekly demand, a daily Quasimodo support area (see above for levels), and also the 0.7900 handle. Buying on the other hand has, apart from the current downtrend, all of the above IN FAVOR. Therefore, under those circumstances, we have decided to watch 0.7900 very closely today for confirmed buying action on the lower timeframes. In the event that we do manage to find an entry long here, our overall target will be set just below the triple-digit round number 0.8000 at 0.7990, which lines up beautifully with  the small daily supply area mentioned above at 0.8050-0.7994.

4hr

Current buy/sell levels:

  • Buy orders: currently watching for lower-timeframe confirmation around the 0.7900 area (Predicative stop-loss orders seen at: dependent on where one confirms this level).
  • Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

 

USD/JPY:

Weekly Timeframe: Last week saw very little action on the USD/JPY pair, which as a result formed a weekly inside bar. Should traders take this as a valid bullish signal considering that price is currently hovering above a major swap level seen at 115.50?

Daily Timeframe: Little price movement on the daily timeframe has a resulted in the market remaining capped between a small daily supply area coming in at 119.95-119.14, and a daily demand area seen at 115.55-116.38. It will be interesting to see what the 4hr timeframe has to say about this…

4hr Timeframe: The 4hr timeframe shows that the buyers and sellers continue to battle for position between a 4hr supply area seen at 118.84-118.52, and a 4hr demand area at 116.91-117.22.  And as such, much of our previous analysis remains the same…

With all of the above taken into consideration, we can see that the weekly timeframe is trading just above a weekly swap level, and has printed a potential bullish signal (inside-bar candle pattern). The daily timeframe on the other hand shows that in order for this bullish signal to ‘work’, price would have to take out a near-term daily supply area (see above for levels). That being the case, we believe there to be two options for any bulls out there:

  • Trade within the current 4hr range from the aforementioned 4hr demand area (tentative buy orders are seen just above at 117.25). This is clearly a respected zone, and will likely react again. However, we personally would only take a trade here with lower-timeframe confirmation since fakeouts are so very common within consolidative areas such as here.
  • The second option is a more conservative one, and requires patience. One would have to wait for price to close above the small 4hr supply area coming in at 119.31-119.12 (located just within the daily supply area mentioned above at 119.95-119.14). This will be the cue to begin looking for fresh longs as the path would then likely be clear up to a nice-looking 4hr supply area sitting at 120.73-120.39.

The approach to selling this market is a little different as we mustn’t forget that price is currently trading above a major weekly swap level (see above). Does this mean that selling is out of the question? Absolutely not. Areas to watch for selling action are as follows:

  • The 4hr supply area at 118.84-118.52, which forms the upper limit of the current 4hr range. Entering short at around 118.47 is a valid sell. But one that (in our opinion) requires confirmation.
  • The 4hr supply area that was just mentioned at 119.31-119.12 (tentative sell orders are seen just below at 119.08). This area is effectively the last line of defense for the aforementioned daily supply area. Again, we would only consider shorts here with corresponding lower-timeframe confirmation.

4hr

Current buy/sell levels:

  • Buy orders: 117.25 [Tentative] (Predicative stop-loss orders seen at: 116.85).
  • Sell orders: 118.47 [Tentative] (Predicative stop-loss orders seen at: 118.88) 119.08 [Tentative] (Predicative stop-loss orders seen at: 119.38).

 

USD/CAD:

Weekly Timeframe: The weekly timeframe shows that the buyers conquered yet another key weekly swap level last week seen at 1.2260. This move has potentially opened the gates for prices to challenge a major weekly Quasimodo resistance level seen at 1.2765.

Daily Timeframe: Yesterday’s trading action saw yet another round of buying, thereupon forcing price higher into a daily supply area coming in at 1.2504-1.2385. In the event that this area is consumed, the path north will likely be clear up to another daily supply area seen at 1.2713-1.2595, which if you look closely is effectively a key obstacle to a move towards the aforementioned weekly Quasimodo resistance level.

4hr Timeframe: The 4hr timeframe shows that the USD/CAD started the week positively with price gapping north up towards Friday’s high at 1.2454. Buyers clearly could not muster enough strength to fully break this high as price plummeted back towards the 1.2400 handle, where at which point strong buyers entered the market, and is at the time of writing seen steaming north towards 1.2500.

Given the points made above, our team came to a general consensus that buy trades will only be considered once/if price closes above and retests 1.2500. This in turn will likely provide a clear run/profit target up to the daily supply area mentioned above at 1.2713-1.2595.

As for selling, we agree that price is currently trading deep within daily supply (see above) at the moment, and that price is lingering just below 1.2500, but selling after price has just demolished a major key level on the weekly timeframe may not be the best path to take. So, until we see weakness on the weekly chart, our bias is well and truly long on this pair.

4hr

Current buy/sell levels:

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

 

DAX 30:

Weekly Timeframe: Price closing above the weekly trendline resistance level formed from the high 7347 (14/02/11) clearly inspired the buyers, as price continues on its relentless march north. This move was also likely supported by the ECB’s recent announcement of quantitative easing to try and boost the Eurozone economy.

Daily Timeframe: Yesterday saw the market retest the aforementioned weekly trendline level before rallying an impressive 251 points (figure includes pre/after-market hours).

4hr Timeframe: The 4hr timeframe shows that price gapped lower at the open (10584) to (as already mentioned above) retest the aforementioned weekly trendline level.

Traders who read our last report on the DAX may recall us mentioning to watch for lower-timeframe buying confirmation around the base of the weekly trendline support level. We could not see any worthwhile price action on lower timeframe, so we unfortunately missed this move. 

The recent ascent has consequently formed a nice-looking 4hr decision-point demand area coming in at 10584-10658 (tentative buy orders seen just above at 10668). This – if price returns of course, will likely provide a supportive base in which to look for buying opportunities sometime this week.

4HR

Current buy/sell levels:

  • Buy orders: 10668 [Tentative] (Predicative stop-loss orders seen at: N/A: 10571).
  • Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

 

DOW 30:         

Weekly Timeframe: The weekly timeframe shows that for seven consecutive weeks price has been hovering above an ignored weekly Quasimodo level at 17135, which has recently formed an inside bar pattern – anyone for higher prices???

Daily Timeframe: The daily timeframe shows that the DOW is currently in a phase of consolidation between a daily swap level coming in at 17896, and a daily demand area seen at 17032-17186. What is more, notice the symmetrical triangle forming, this tells us that something may be brewing and it could be explosive.

4hr Timeframe: The 4hr timeframe shows that that DOW gapped south at the open (17546), but consequently found a small pocket of demand just above the 4hr decision-point demand area at 17397-17492 to be supportive enough to allow the buyers back play, which in turn quickly saw the weekend gap filled. For anyone who managed to find an entry long here, well done!

We know from the higher-timeframe analysis that price is currently trading/hovering above an ignored weekly Quasimodo level, and that the daily timeframe shows price effectively consolidating for the time being (see above). Can anyone smell accumulation here for a potential breakout north?

With the above taken into consideration, we are going to avoid selling for the time being. Buying on the other hand around the 17502 mark, seen above the aforementioned 4hr decision-point demand area is still a valid buy zone, and one that should be watched closely today for confirmed buy entries on the lower timeframes.

4hr

Current buy/sell levels:

  • Buy orders: 17502 [Tentative] (Predicative stop-loss orders seen at: 17390).              
  • Sell orders: Flat (Predicative stop-loss orders seen at: N/A).