DAILY REVIEW 9 Oct 2013

EU: The Daily candle is a small spread (50 pips) bear spinning top closing on below-average vol>1day. The close and volume suggests no selling pressure and may also hint at possible accumulation.

 The Asian range is 1.3561 – 1.3604 with a TR 1.3537 – 1.3605 with an upper bound 1.3562 – 1.3605 and a lower bound 1.3537 – 1.3562. Notable levels (unchanged):  1.3537, 1.3520 confluence with 1.3517 (23.6%Fib), 1.3597 (last Fri NY high) We note that price spiked below the 1.3562 level yesterday and then kept closing above it. Price also failed to close above the 1.3600 level  making a double top in the H1 chart and a bear engulfing candle in the H4 chart. However, volume appears to be drying up as price reaches the lower bound 1.3562  This suggests that SM may be done with the lower bound. However, there is still some way before the H4 candle closes. My guess is that SM has painted a picture of an impending down move to state the obvious. However, a possible SM play would be to continue the selling pressure fading and discouraging longs before reversing back up to test supply. A possible reversal area would be the 1.3562 area. A H1 close below the TR low of 1.3537 would likely see more downside.

EU long levels:  1.3562, 1.3537, 1.3520, 1.3505 EU short levels:  1.3573, 1.3600, 1.3631, 1.3655, 1.3670, 1.3700, 1.3715

GU: The Daily candle is a normal spread (105pips) bear high-wave with the long tail below closing on below average vol>1day. The candle close and spread suggests more downside and the volume suggests SM mark-up/fading of weak shorts. The Asian range is 1.6060 – 1.6120 The TR is unchanged  1.6004 - 1.6076 with price testing the 1.6100 level twice but failing to close above it and currently back in the TR. SM painted a double top as well.  Notable: confluence[H1 ema200 @ 1.6110 61.8% Fib 1.6110], 38.2%Fib @ 1.6070, 23.6%Fib @1.5917 confluence with trend channel support. Gap close level @ 1.5872 Weekly ema200@ 1.5946 The longer that price stays above the Monday gap, the more unlikely it is to close. SM is likely to maintain selling pressure to fade weak longs before reversing back up.  A H1 close below 1.6000 will likely see more downside.

GU long levels:  1.6050, 1.6020, 1.6000, 1.5978, 1.5954, 1.5931, 1.5848, 1.5824 GU short levels: 1.6120, 1.6155, 1.6180, 1.6197, 1.6226, 1.6240, 1.6259, 1.6320, 1.6353, 1.6380