DAILY REVIEW 4 August 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 but he absorption of selling is likely a precursor to a retest of the 1.1640 and the 23.6% Fib (1.1794) just above it.  

MONTH- The candle is a below-average spread (407pips) bear closing 1/2 off the low on very high vol<1month. The candle close and volume suggests buying. 

WEEK- The candle is a below average spread (236pips) bull near "doji" closing on low vol>1week. The candle close and volume suggests absorption of selling. 

DAY- The candle is a small spread (54pips) bear closing just off the low on low vol<5days. The candle close and volume suggests no selling pressure.

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: The Eurozone remains on the back-burner but still burning nonetheless. This is a data-packed week with lots of risk events and taking the spotlight this week will likely be the release of the US NFP on Friday. 

The Oanda order book significant trapped short volume and hardly any net stops long or short. 
Potential Fresh demand: 1.0955 (low vol), 1.0934-1.0919, 1.0900-1.0890, 1.10815-1.10800 
Potential fresh supply: 1.1098-1.1109, 1.1120-1.1135, 1.1150-1.1157, 1.1195-1.1213
Long (stop) orders: 1.0964-1.0955 (very low vol)
Short (stop) orders: 1.0985-1.1030, 1.1058-1.1074, 1.1138-1.1144, 1.2220-1.2234

Prices made a lower low to 1.0930 early and reversed after that. SM is likely to continue buying pressure to test 1.1000 or higher before reversing. 

EU long levels: 1.0950, 1.10935, 1.0911-1.0900, 1.0892 

EU short levels: 1.1060-1.1070, 1.1128-1.1145, 1.1158-1.1165, 1.1215-1.1230


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 a below average spread (402pips) bear hammer closing on very high vol, the highest seen. The candle close and volume suggests more upside.

WEEK- The candle is a below average spread (199pips) bull closing 1/4 off the high on high vol> historical. This is in terms of buying activity, not contracts. The candle close and volume suggests more upside.

DAY - The candle is a below average (79pips) bear spinning top closing on low vol<3dys. 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 has traders trapped in both directions. The long trapped stop top volumes are more significant. Fresh demand is generally insignificant.

Potential demand stacks: 1.5510-1.5495, 1.5485-1.5472 (low volumes) 
Potential supply stacks: 1.5670-1.5680, 1.5695-1.5705

Potential long (trapped) stops:  1.5620-1.5588, 1.5550-1.5540, 1.5520-1.5509, 1.5451-1.5435, 1.5400-1.5385, 1.5305-1.5295

Potential short (trapped) stops: 1.5586-1.5622, 1.5640-1.5649, 1.5680-1.5695, 1.5705-1.5718, 1.5725-1.5736, 1.5805-1.5815 

Traders are still trapped both ways. The poor Construction PPI data released earlier only resulted in a push to a new low at 1.5568 but looks like strong absorption of selling. SM is likely to maintain selling pressure to test the 1.5565 level or lower before resuming the upward move. 

GU long levels: 1.5570, 1.5560-1.5550, 1.5515-1.5500, 1.5460-1.5445, 1.5403-1.5395

GU short levels: 1.5635, 1.5650, 1.5715-1.5725, 1.5797-1.5807

Posted at 05.26 am EST