DAILY REVIEW 5 February 2015

EU Analysis:

EU: Perspective: Price has closed below the weekly/daily 1.1376 pivot and does not have any significant demand level till the 1.1000 - 1.0762 pivot potential demand level. Bias is strongly down. Possible retracement short levels will be around the previous breakout levels. 

Month- The candle is a very large spread bear closing off the low on ultrahigh vol>38months. The candle close and volume suggests more downside. 
Week- The candle is a large spread (565pips) bull closing 1/2 off the high on high vol<2weeks. The candle close and volume suggests reduced selling interest but expected further downside.

Daily- The candle is a large spread (169pips) bear closing near the low on low vol<1day. The candle close and volume suggests more downside.   
Levels of interest: Demand: Daily/Weekly:  1.1000, 1.0762  

Background: Fundamentals for the Euro remain weak.  

The sentiment remains bearish for the Euro amidst the sudden plunge as the ECB rejected the proposed Greek collateral. However, the SM corrective cycle long for reload of short positions looks to have commenced and is likely to continue. 
Based on the Oanda order book, there is significant volume trapped short.
Potential Fresh demand: 1.1300-1.1290, 1.1220-1.1195 
Potential fresh supply at 1.1400, 1.1450, 1.1500
Trapped long (stop) orders: 1.1300, 1.1240-1.1230, 1.1200-1.1185  
Trapped short (stop) orders: 1.1540-1.1570, 1.1595-1.1610

SM is likely to create selling pressure to retest the day low around the 1.1303 level before reversing to resume the corrective move long. 

EU long levels: 1.1300, 1.1270, 1.1250, 1.1220, 1.1200, 1.0965, 1.0920, 1.0762

EU short levels: 1.1500, 1.1533, 1.1560, 1.1600, 1.1630, 1.1678


GU Analysis:

GU: Perspective: GU has dropped further on USD strength. It is headed to test the 1.4812 pivot which is a potential corrective move level. 
Month- The candle is a large spread bear closing just off the low on ultrahigh volume. The candle close and volume suggests more downside. 
Week- The candle is a normal spread (237pips) bull "inverted hammer" closing on low vol<3weeks. The candle close and volume suggests buying activity but more downside can be expected. 

Day- The candle is a normal spread (111pips) bull pseudo upthrust closing on low vol<1day. The candle close and volume suggests more upside.

Demand: Weekly/Daily:  1.4870 - 1.4812, 1.4229 Supply: Short term: 1.5400, 1.5470, 1.5500, 1.5540, 1.5600 

The GU dropped together with USD strength in wake of the ECB decision but has since recovered underpinned by earlier good UK data. The SM cycle remains biased with a significant volume of traders trapped short. 
Potential demand stacks: 1.4990-80, 1.4950-40 (unchanged)
Potential supply stacks: 1.5200 (very small supply, not really significant) no supply above this.
Potential short (trapped) stops: 1.5270-80, 1.5300-20, 1.5400 
Potential long stops/manipulation: 1.5100, 1.5080
There is no significant potential fresh supply, possible short term manipulation level for an intraday short trade is at 1.5223, 1.5270. SM is likely to continue fading weak shorts to around 1.5223 or higher before reversing to remove weak longs to the 1.5100 - 1.5080 level before resuming the corrective move upward.

GU long levels: 1.5100, 1.5180, 1.4988, 1.4950, 1.4938, 1.4930, 1.4870, 1.4812 

GU short levels: 1.5222, 1.5268, 1.5298, 1.5326, 1.5350, 1.5347, 1.5415, 1.5478

Posted at 3.12 am EST