DAILY REVIEW 6 Aug 2013

EU: Daily narrow-spread (68pips) bear spinning top closing on average vol<4 days. The candle close and volume suggests no selling pressure. It is interesting that after failing to break 1.3300, prices never really dived and most broker open positions show an increased net short position. If the intention is to go back up as what the “no selling pressure” suggests, SM will be likely to create selling pressure to remove weak longs and test the 1.3200 key level and maybe even up to the 1.3182 level, then reverse upwards.

EU long levels:  1.3200, 1.3185, 1.3165 EU short levels:  1.3300, 1.3321, 1.3342

GU: Daily candle is a normal-spread (120pips) bull closing off the high on lower than average volume <3days. The close(at the technical daily trendline) does suggest more upside and the volume suggests SM is behind the move. Price is close enough to test the daily supply level at 1.5410 – 1.5433 and the likelihood is that it will. Broker short positions have increased as traders have aggressively shorted the rise. SM would likely create selling pressure to fade the weak longs before reversing but I don’t expect it to go too low as they will not want to give too much away to traders already short.

GU long levels:  1.5300, 1.52985, 1.5200, 1.5150 GU short levels: 1.5480, 1.5500, 1.5525