DAILY REVIEW 24 Sep 2013

EU: The Daily candle is a below-average spread (69pips) bear closing near the low on average vol<3days which indicates no selling pressure. A major broker reports that long positions are higher than yesterday although below levels seen last week whereas short positions are slightly lower than yesterday. SM will make the most of the uncertainty in Germany and are likely to maintain the impression of selling pressure as well as take out the new longs (presumably the retail crowd) before they reverse upwards to test the supply levels. From a short-term supply/demand perspective, there is really no valid demand level near current price levels but a H1 close below yesterday’s low may see price go to 1.3451 which is the previous swing high that was broken.

EU long levels:   1.3478, 1.3450, 1.3382  EU short levels:  1.3555, 1.3575, 1.3600, 1.3655, 1.3700, 1.3715

GU: The Daily candle is a near-average spread (80pips) bull closing about 1/3 off the high on below-average vol<3days which suggests no buying pressure. Broker platforms also show that traders have grown less net-short from yesterday and last week. One major broker reports that long positions are higher than yesterday and also increased above levels seen last week. SM is likely to create selling pressure to fade weak longs, possibly the late entrants to the market and perhaps even retracing more of the news move from last week before reversing to retest supply.

GU long levels: 1.6015, 1.5985, 1.5977, 1.5922  GU short levels:  1.6071, 1.6105, 1.6148, 1.6162, 1.6175, 1.6200