DAILY REVIEW 25 Feb 2014
EU: The Daily candle is a small spread (63pips) bull near-doji closing on low vol>1day. The candle close and the volume suggests a bear trap about to be sprung. Unchanged Levels of interest: Demand: short term-  1.3692 – 1.3715,  1.3600 – 1.3605 (Friday Asia breakout), 1.3590 – 1.3584 (daily trend-line 1.3580), 1.3563 – 1.3550 Supply: 1.3787 – 1.3818. The Asian range is 1.3728 – 1.3744. SM continued to accumulate as written yesterday to “around the 1.3720 level (actual 1.3707) before heading back north.” SM is currently pushing up and is likely to test yesterday’s high or close to it before reversing back down to the 1.3700 key level or lower before reversing north if the aggregate buy orders are still insufficient. Alternatively, if the orders are stacked up, we could see a push up to the 1.3800 – 1.3817 level where it may reverse and fall back to around previous breakout level of 1.3724 and reverse northward.   A close below 1.3672 would likely mean more downside.
EU long levels:  1.3724, 1.3700, 1.3685, 1.3590, 1.3585, 1.3559 EU short levels: 1.3800 – 1.3817

GU: The Daily candle is a normal spread (95pips) bull closing off the high on low vol<4days. The candle close and volume suggests no demand and but it smacks of a typical SM bear trap being setup.  Continued unchanged Levels of interest: Weekly/Daily supply level 1.6835 – 1.6845, 1.6860 – 1.6875, 1.6991 – 1.7015, 1.7025 – 1.7045 short-term supply: 1.6700 – 1.6724 Demand:  short-term previous Asia low 1.6638 (H1 ema200 confluence) 1.6573 – 1.6555, 1.6514 – 1.6533, 1.6401 – 1.6490, 1.6354, 1.6330 – 1.6320, 1.6300 key level. The Asian range is 1.6644 – 1.6682. SM cleared demand to 1.6582 yesterday opening the way to the demand at 1.6514 – 1.6533 if it breaks low. SM had clearly been stocking long inventory and therefore likely to test the short term supply at 1.6700 – 1.6724 before reversing to the 1.6700 and lower if a reversal is in place. Alternatively, a break past 1.6724 will see a test of the 1.6823 daily supply level. There is really no change from yesterday as the orders are still not stacked up.
GU long levels:  1.6638, 1.6575, 1.6514, 1.6400, 1.6354, 1.6440, 1.6300 GU short levels:  1.6722 1.6823, 1.6835, 1.6860, 1.7000, 1.7030

Posted at 4.07 am EST