DAILY REVIEW 8 July 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.  

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 a below average spread (324pips) bull closing 1/2 off the high on low vol>2weeks. The candle close and volume suggests more downside. 

DAY- The candle is a large spread (141pips) bear "reverse upthrust" closing on high vol>5days. The candle close and volume suggests more downside.

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: The continuing Euro-Greek saga places a lot of questions on the future of the Eurozone as its leaders must now find a solution for Greece. Forcing the Greeks out of the Eurozone is not desirable whereas forgiving the debt may set an unsustainable precedent for the other indebted member countries who had already taken the austerity pill. This makes for a week of volatility as the market begins to find a direction. 

The Oanda order book shows overwhelming net trapped short volume. 
Potential Fresh demand: 1.0982-1.0973, 1.0924-1.0915
Potential fresh supply: 1.1065-1.1075, 1.1092-1.11131.1230
Long (stop) orders: 1.0975-1.0963
Short (stop) orders: 1.1117-1.1135, 1.1140-1.1150 

More trapped shorts were taken out yesterday as SM plunged and then climbed. Prices have stayed pretty much in yesterday's range ahead of the FOMC minutes being released at 1900 hrs GMT today. The Oanda platform Net positions still show the bulk of traders trapped short and hardly any net long or short stops level. There is some supply from 1.1065-1.1120 and some demand at 1.0975 and 1.0925. SM is likely to induce buying to take stops at 1.1070 or higher before reversing.

EU long levels: 1.0895-1.0875, 1.0828-1.0818 

EU short levels: 1.1068-1.1083, 1.1107, 1.1120-32, 1.1150


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 spread (233pips) bear closing at the low on very high vol>23weeks. The candle close and volume suggests more downside.

DAY - The candle is an ultra-large spread (196pips) bear closing 1/4 off the low on very high vol>5days. 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 a mix of traders trapped in both directions without any significant bias in retail trapped positions. 

Potential demand stacks: 1.5500-1.5490, 1.5359-1.5340, 1.5300-1.5345
Potential supply stacks: 1.5692-1.5705
Potential long (trapped) stops:  1.5519-1.5505
Potential short (trapped) stops: 1.5638-1.5655, 1.5680-1.5690, 1.5701-1.5715, 1.5781-1.5815, 1.5922-1.5952  

With long trapped stops and short trapped stops in position, From a logical vie, SM is likely to take out the weak longs (as there is more volume trapped long than short) before reversing.  SM is likely to retest the current low 1.5412 or lower before reversing. Price dove as I was writing.... lol, it will likely test the next structure creek around 1.5350, re-analyze prior to FOMC release to look for possible levels. 

GU long levels: must re-assess

GU short levels: 1.5628-32, 1.5656, 1.5680-1.1690, 1.5710-1.5722

Posted at 03.29 am EST