DAILY REVIEW 7 Feb 2014
EU: The Daily candle is a large spread (136pips) bull closing off the high on average vol>2days. The candle close and volume suggests a possible reversal. Unchanged Levels of interest: Daily Demand: 1.3405 – 1.3398, 1.3355 – 1.3344, 1.3318 – 1.3294 Short term supply: 1.3655 – 1.3665. The Asian range is 1.3580 – 1.3594. SM moved EU up during ECB’s Draghi’s speech after good US news taking out stops of weak longs and reversing back upwards with fresh inventory. SM has since reversed at the short term supply of 1.3606 – 1.3623 identified earlier and the effect of the move out of demand suggests a reversal and it is likely for SM to induce shorts taking profit as they move back down to test the breakout level at 1.3530 or lower before reversing upward to continue the mark up. With NFP tonight, we can expect false moves most likely culminating in a northbound movement.
EU long levels:  1.3480, 1.3405, 1.3355, 1.3318 EU short levels: 1.3606, 1.3655

GU: The Daily candle is a below average spread (75pips) bear dragon fly doji closing on low vol>2days. The candle close and volume suggests more upside. Again, unchanged Levels of interest: Short-term supply level 1.6487 – 1.6500 (confluence:  Fib 50% @ 1.6487), 1.6550 – 1.6560, 1.6615 – 1.6630, 1.6650 – 1.6667 Daily Demand:  1.6260 - 1.6250 (current low), 1.6225 – 1.6215
The Asian range is 1.6316 – 1.6357. If SM moves to the supply at 1.6487 – 1.6500 pre-NFP, they will likely fade the weak shorts and retest the breakout at 1.6325 before reversing back upwards. If they maintain the current range, they will likely test the current lows or lower before reversing for a possible reversal.
GU long levels:  1.6251, 1.6220 GU short levels:  1.6360, 1.6487, 1.6550, 1.6625, 1.6650, 1.6667