DAILY REVIEW 8 April 2015

EU Analysis:

EU: Perspective: Price has tested and broken through the 1.0500 which is simply a monthly low and psychological level with the next pyschological level at 1.0000 and the 0.9900 level being the breakout retest of a reaccumulation structure. Bias is still strongly down. Possible retracement short levels will be around the new breakout levels. 

Monthly- The candle is a large spread (778pips) bear closing nearly 1/2 above the low on ultrahigh vol>1month. The candle close and volume suggests profit taking.  However more downside can be expected as price will likely test the low. 

Week- The candle is a below average spread (313pips) bull "near hammer" closing off the high on low vol<3weeks. The candle close and volume suggests more upside but with reduced buying pressure.  Technically the trend is still down.

Daily- The candle is a large spread (151pips) bear closing at the low on low vol>2days. The candle close and volume suggests more downside.

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: Fundamentals for the Euro remain weak as the US FED mulls over the rate increase implementation. However, ECB Bond purchases remain strong and at high pace, "Inflows into Europe-focused equity exchange-traded funds reached a record $7.8 billion in March, posting inflows on every trading day of the month, according to data by TrimTabs Investment Research on Tuesday." That was up from the previous record of $4.4B."- quoted from ForexLive. The implication of course is that this creates demand for the Euro. Even as the US Dollar grinds higher probably only positioning for the upcoming FOMC minutes being released today at 2.00 pm EST.

The Oanda order book still shows significantly more trapped short volumes. 
Potential Fresh demand: 1.0815-1.0795, 1.0750-1.0730,  1.0721-1.0710, 1.0700-1.0690, 1.0650-1.0640, 1.0605-1.0585, 1.0500-1.0490, 1.0465-1.0430, 1.0400, 1.0000
Potential fresh supply: 1.0853-1.0885, 1.0898-1.0907, 1.0947-1.0957, 1.0998-1.1010, 1.1034-1.1060, 1.1093-1.1100, 1.1190-1.1200
Trapped long (stop) orders: 1.0806-1.0778, 1.0716-1.0680, other levels insignificant vol
Trapped short (stop) orders: 1.0850-1.0865, 1.0873-1.0890, 1.0900-1.0905, 1.1040-1.1062, 1.1090-1.1106, 1.1190-1.1200

After pushing lower, SM is likely to continue fading weak longs to 1.0885 or higher before before reversing to test the low 1.0805. 

EU long levels: 1.0800-1.0785, 1.0775-1.0760, 1.0750, 1.0700, 1.0685, 1.0500-1.0496, 1.0490-1.0480, 1.0000

EU short levels: 1.0880, 1.0890-1.0905,1.0950-1.0965, 1.1015-1.1035, 1.1193-1.1200, 1.1257, 1.1270


GU Analysis:

GU: Perspective: GU has closed strongly past the monthly 1.4812 pivot and broken the 1.4700 key level, headed toward  the next monthly pivot 1.4225 monthly pivot which is the next possible level of support/demand. With the UK General Elections due this 15 May 2015, we can expect volatility as the market reacts to the possible twists and turns in the run up. The candle is still well within the FOMC 18 March 2015 range.

Month- The candle is a large spread (794pips) bear closing 1/4 off the low on high vol>1month. The candle close and volume suggests profit taking prior to a retest of the lows. 
Week- The candle is a below average spread (205pips) small-bodied bull closing off the high on low vol<3weeks. The candle close and volume suggests no buying pressure but more upside can be expected.

Day- The candle is a normal spread (117pips) bear closing at the low on low vol>3days. The candle close and volume suggests more downside.

Demand: Weekly/Daily:  1.4870 - 1.4812, 1.4229 Supply: Short term: 1.5574, 1.5600, 1.5619 

The Oanda order book shows slightly more trapped short volume.  

Potential demand stacks: 1.4805-1.4790, 1.4780-1.4765, 1.4755-1.4745, 1.4700-1.4693 (not really significant volume)
Potential supply stacks: 1.5000-1.5010, 1.5100-1.5110, 1.5200-1.5210
Potential short (trapped) stops: 1.4915-1.4930, 1.4980-1.5005, 1.5020-1.5055, no significant higher volumes
Potential long stops: 1.4803-1.4780,1.4736-1.4705, 1.4635-1.4605, no significant lower volumes
SM is likely to fade weak shorts to 1.4915 or higher before reversing to test the low at 1.4802.  

GU long levels: 1.4870, 1.4850, 1.4810, 1.4750, 1.4720, 1.4700, 1.4630

GU short levels:  1.5000, 1.5026, 1.5100, 1.5136, 1.5150, 1.5200, 1.5225, 1.5280, 1.5305, 1.5320, 1.5400, 1.5420, 1.5457, 1.5500

Posted at 3.05 am EST