DAILY REVIEW 20 July 2015

For those who asked, last Friday was a public holiday in Singapore.

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.  

MONTH- The candle is an above average spread (647pips) bear equal-bodied (same size of wicks) spinning top closing on very high vol<2weeks. This is absorption of selling. The candle close and volume suggests more upside. 

WEEK- The candle is an above average spread (368pips) bear closing at the low on low vol<2weeks. The candle close and volume suggests more downside. 

DAY- The candle is a small spread (78pips) bear closing at the low on low vol<9days. The candle close and volume suggests more downside.

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: Last week saw the "rescue" of the Greek economy with the "Grexit" being avoided.... at least for now. IMF has also stated that Greece will not be able to meet its debt obligations without some of it being forgiven. US Housing starts probably precipitated Gold prices falling to 2010 levels as the US Dollar gained traction. We had Yellen reaffirming that rates would be raised this year. Then of course, later we have the "caveat" from FED's Fischer that inflation is still too low. Sentiment in the Eurozone is not particularly great at the moment and the French President is now calling for a European "Government", something that is sorely needed if the EU is going to reinvent itself as monetary union in itself without fiscal union is going to be impossible in practice.

The Oanda order book shows overwhelming net trapped short volume. 
Potential Fresh demand: 1.0700 (very low vols)
Potential fresh supply: 1.0940-1.0955, 1.0995-1.1005, 1.1030-1.1055, 1.1080-1.1105
Long (stop) orders: 1.0818-1.0805, 1.0795-1.0705
Short (stop) orders: 1.0852-1.0870, 1.0907-1.0917, 1.0970-1.0985 

The unrest in Greece is not going to disappear anytime soon and the continued implementation of bailout demands will continue to create flashpoints and the Oanda platform Net positions show limited market volume with stop clearly loaded on the lows. SM is likely to continue the selling pressure to test the 1.0818 pivot or lower, possibly  before reversing to take the weak shorts out and then plunge again.

EU long levels: None yet

EU short levels: 1.0860-1.0875, 1.0895, 1.0907-1.0920, 1.0970-1.0985,  1.1100-1.1005


GU Analysis:

GU: Perspective: GU has closed strongly past the last month's low 1.4633 and looks headed toward  the next monthly pivot 1.4225 monthly pivot which is the next possible level of support/demand. However, structures below and the close above 1.5550 indicate a return to the 1.6000 level and higher is quite possible. 

MONTH-  The candle is an above average spread (725pips) bear upthrust closing on very high vol>3months.  The candle close and volume suggests more upside.

WEEK- The candle is a below average sread (224pips) bull large body spinning top closing on high vol<2weeks. The candle close and volume suggests more upside.

DAY - The candle is a normal spread (119pips) near "doji" closing on low vol<9days. The candle close and volume suggests no selling pressure.

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

GU has been like a ball being pushed under water as it kept rebounding back up on dips. Not surprising as the Oanda order book was showing a mix of traders trapped in both directions without any significant bias in retail trapped positions all of last week. 

Potential demand stacks: 1.5570-1.5550, 1.5501-1.5577, 1.5459-1.5447, (vols are very low)
Potential supply stacks: 1.5645-1.5667, 1.5690-1.5700, 1.5745-1.5780, 1.5792-1.5802, 1.5900-1.5908

Potential long (trapped) stops:  1.5547-1.5513, 1.5440-1.5421, 1.5397-1.5382, 1.5328-1.5300

Potential short (trapped) stops: 1.5610-1.5620, 1.5670-1.5680, 1.5705-1.5727 

Prices opened slightly gapped down by 16pips but has since closed quickly. Oanda Retail Fx positions show newly trapped long volumes and SM is likely to use the US Dollar strength to fade weak longs to retest the 1.5552 or lower before resuming the upward move. 

GU long levels: 1.5570, 1.5550, 1.535-1.5530

GU short levels: 1.5650, 1.5675, 1.5700-1.5710, 1.5745-1.5758, 1.5791-1.5800

Posted at 01.40 am EST