DAILY REVIEW 15 Oct 2013
EU: The Daily candle is a small spread (53 pips) upthrust doji closing about 2/3 off the high on low vol<99days. The volume indicates almost no market participation and the Asian range is 1.3549 – 1.3570 ~ almost the same as yesterday. The H4 TR is unchanged 1.3461 – 1.3645 with Lower (TRL): 1.3461 – 1.3520 Upper (TRU): 1.3521 – 1.3645 Nothing has really changed and current prices are still well within range of the weekly supply levels: 1.3650 – 1.3710 However, yesterday’s candle is likely to give the herd cause to short from the highs or thereabouts and this would seem to be in line with the possibility of the US reaching some kind of deal to increase the debt ceiling. SM is likely to create buying pressure to fade weak shorts and induce buying before reversing back into the range and later reverse for the push back up again. It is improbable for a strong price action with no clear resolution in sight for the US. Price action also suggests this is a likely scenario as SM appears to have no interest in even closing the gap at 1.3540 The better trade setups will be at the TRL and TRU. However, as the majority of open positions remain net short, it would not be strange if SM pushes prices up past the 1.3600 handle to retest the higher supply levels. A H1 close below 1.3461 will likely see more downside.  
EU long levels:  1.3550, 1.3529, 1.3507, 1.3485, 1.3462, 1.3355, 1.3270 EU short levels: 1.3575, 1.3600, 1.3631, 1.3655, 1.3670, 1.3700, 1.3715


GU: The Daily candle is a below-average spread (64pips) bull pin bar on low vol<34days. The candle close suggests no buying pressure and the volume almost no market participation. The Asian range is 1.5951 – 1.5997. Price is still within the TR of 1.5913 - 1.5985 Price still failed to hold above the key 1.6000 handle yesterday. The daily candle, close and volume would entice a lot of traders to go short once price goes anywhere close to the 1.6000 handle and SM has started to reverse somewhat from 1.5997 at the moment. However, it would also be a great short trap as price has yet to close and cover the gap at 1.5947 although it has come close. After the steep run down and bouncing around in this TR for the last 3 days, SM is likely to head upward again as shorts have continued to maintain providing inventory for SM to reload if they want to push further downward. A H1 close above 1.6000 will likely see more upside as some supply at this level would likely have been absorbed and a H1 close below 1.5850 will likely see more downside.
GU long levels: 1.5935, 1.5922, 1.5900, 1.5880, 1.5850 GU short levels: 1.6000, 1.6120, 1.6155, 1.6180, 1.6197, 1.6226, 1.6240, 1.6259, 1.6320, 1.6353, 1.6380