DAILY REVIEW 28 January 2016

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. December's candle suggests a retracement is in progress. We also note that there are no significant orders/ stops lower until the 1.0000 key level. Bias is still strongly down from a market structure perspective.    

MONTH- The candle is a below average spread (541pips) bull closing 1/3 off the high on low vol>2months. The candle close and volume suggests more upside. 

WEEK- The candle is a near-normal spread (198pips) bear closing near the low on low vol<2weeks. The candle close suggests more downside. 

DAY- The candle is a below average spread (66pips) bull spinning top closing on low vol>2days. The candle close and volume suggests more upside. 

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: Tumbling oil prices with the expected additional supply of Iranian oil also creates further uncertainty.

The Oanda order book continues with a majority of net trapped short positions volumes. 

Potential demand stacks:  N.A.

Potential supply stacks: N.A.

Potential long (trapped) stops:  1.0677-1.0660, 1.0639-1.0612
Potential short (trapped) stops: 1.0922-1.0930, 1.0982-1.0990, 1.1060-1.1017, 1.1093-1.1122 

The US data to be released later will be the catalyst as usual. Yesterday I wrote "Expect a continuation upward to retest the day high or higher before reversing" and true to form, price tested 1.0915 before retracing. However, with the trapped volume pretty much in play, a spike to 1.1000 is not out of the question. SM is likely to continue fading weak shorts by retesting the 1.0915 level or higher.

EU long levels: 1.0800-1.0795, 1.0762-1.0740, 1.0700  

EU short levels: 1.0915-1.0927, 1.0983-1.1000, 1.1060, 1.1105, 1.1208

GU Analysis:

GU: Perspective: GU has closed below April pivot 1.4564. The June close of 1.5701 becomes important as a supply level to overcome for higher prices. The downward bias is still dominant. 

MONTH-  The candle is a below average spread (507pips) bear closing at the low on low vol>1month. The candle close and volume suggests more downside.

WEEK- The candle is an above average spread (282pips) bull "near doji" closing 2/3 off the low on high vol>20weeks. The candle close and volume suggests buying.
DAY- The candle is a normal spread (125pips) bear closing at the low on average vol>2days. The candle close and volume suggests more downside. 

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

The Oanda order book shows a significant volume of trapped longs.

Potential demand stacks: Not significant
Potential supply stacks: Not significant

Potential long (trapped) stops:  1.4228-1.4200, 1.4179-1.4156, 1.4075-1.4021 (small vol)

Potential short (trapped) stops: 1.4360-1.4385, 1.4696-1.4729

The volumes remain very thin and caution is advised. With UK data expected later today, SM is likely to test the 1.4200 key level or lower before reversing.

GU long levels:  1.4100

GU short levels: 1.4365, 1.4425, 1.4512, 1.4535, 1.4600

Posted at 1.42 am EST

DAILY REVIEW 27 January 2016

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. December's candle suggests a retracement is in progress. We also note that there are no significant orders/ stops lower until the 1.0000 key level. Bias is still strongly down from a market structure perspective.    

MONTH- The candle is a below average spread (541pips) bull closing 1/3 off the high on low vol>2months. The candle close and volume suggests more upside. 

WEEK- The candle is a near-normal spread (198pips) bear closing near the low on low vol<2weeks. The candle close suggests more downside. 

DAY- The candle is a small spread (55pips) bull "hammer" closing on low vol>1day. The candle close and position suggests more upside. 

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: Tumbling oil prices with the expected additional supply of Iranian oil also creates further uncertainty.

The Oanda order book still shows a majority of net trapped short positions volumes. 

Potential demand stacks:  N.A.

Potential supply stacks: N.A.

Potential long (trapped) stops:  1.0677-1.0660, 1.0639-1.0612
Potential short (trapped) stops: 1.0922-1.0930, 1.0982-1.0990, 1.1060-1.1017, 1.1093-1.1122 

The US New Home Sales data to be released later will be the catalyst today. Yesterday I wrote "SM is likely to fade them to around the 1.0865 level or higher before reversing", prices went to 1.0880 before retracing but the bunch of trapped shorts are still very much in play. Expect a continuation upward to retest the day high or higher before reversing.

EU long levels: 1.0800-1.0795, 1.0762-1.0740, 1.0700  

EU short levels: 1.0915-1.0927, 1.0983-1.1000, 1.1060, 1.1105, 1.1208

GU Analysis:

GU: Perspective: GU has closed below April pivot 1.4564. The June close of 1.5701 becomes important as a supply level to overcome for higher prices. The downward bias is still dominant. 

MONTH-  The candle is a below average spread (507pips) bear closing at the low on low vol>1month. The candle close and volume suggests more downside.

WEEK- The candle is an above average spread (282pips) bull "near doji" closing 2/3 off the low on high vol>20weeks. The candle close and volume suggests buying.
DAY- The candle is an ultralarge spread (194pips) bull closing near the high on low vol>1day. The candle close and volume suggests more upside. 

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

The Oanda order book shows newly profitable shorts but volumes are very thin across the range.

Potential demand stacks: Not significant
Potential supply stacks: Not significant

Potential long (trapped) stops:  1.4075-1.4059 (small vol)

Potential short (trapped) stops: 1.4355-1.4385, 1.4422-1.4462, 1.4516-1.4533, 1.4696-1.4729

The volumes are still actually very thin and caution is advised. Without significant news or data expected today, SM is likely to continue oscillating but the bias is to take out the weak shorts. SM is likely to continue fading weak shorts by retesting the current day high of 1.4365 or higher before reversing.

GU long levels:  1.4100

GU short levels: 1.4365, 1.4425, 1.4512, 1.4535, 1.4600

Posted at 3.55 pm EST

DAILY REVIEW 26 January 2016

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. December's candle suggests a retracement is in progress. We also note that there are no significant orders/ stops lower until the 1.0000 key level. Bias is still strongly down from a market structure perspective.    

MONTH- The candle is a below average spread (541pips) bull closing 1/3 off the high on low vol>2months. The candle close and volume suggests more upside. 

WEEK- The candle is a near-normal spread (198pips) bear closing near the low on low vol<2weeks. The candle close suggests more downside. 

DAY- The candle is a below average spread (69pips) bull closing near the high on low vol<4days. The candle close suggests more upside. 

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: Tumbling oil prices with the expected additional supply of Iranian oil also creates further uncertainty.

The Oanda order book still shows a majority of net trapped short positions volumes. 

Potential demand stacks:  N.A.

Potential supply stacks: N.A.

Potential long (trapped) stops:  1.0677-1.0660, 1.0639-1.0612
Potential short (trapped) stops: 1.0896-1.0930, 1.100-1.1017, 1.1026-1.1040, 1.1095-1.1112 

The US Consumer Confidence data will be released later. The bunch of trapped short volumes are still in play, SM is likely to fade them to around the 1.0865 level or higher before reversing.

EU long levels: 1.0800-1.0795, 1.0762-1.0740, 1.0700  

EU short levels: 1.0865, 1.0915-1.0927, 1.0983-1.1000, 1.1060, 1.1105, 1.1208

GU Analysis:

GU: Perspective: GU has closed below April pivot 1.4564. The June close of 1.5701 becomes important as a supply level to overcome for higher prices. The downward bias is still dominant. 

MONTH-  The candle is a below average spread (507pips) bear closing at the low on low vol>1month. The candle close and volume suggests more downside.

WEEK- The candle is an above average spread (282pips) bull "near doji" closing 2/3 off the low on high vol>20weeks. The candle close and volume suggests buying.
DAY- The candle is a below average spread (86pips) bear spinning top closing on low vol<4days. The candle close and volume suggests a lack of selling interest. 

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

The Oanda order book shows more trapped shorts with a build up in volume but also new trapped long volumes.

Potential demand stacks: Not significant
Potential supply stacks: Not significant

Potential long (trapped) stops:  1.4079-1.4064 (small vol)

Potential short (trapped) stops: 1.4355-1.4385, 1.4412-1.4428, 1.4696-1.4712

The volumes are actually very thin and caution is advised. George Carney will be speaking later today which will be the catalyst for SM to take out the weak shorts. Yesterday, I wrote, "SM is likely to remove the weak longs by testing the 1.4200 key level or lower before reversing to continue the retrace". This is ongoing even as price has pushed to 1.4205 today.

GU long levels:  1.4100

GU short levels: 1.4360, 1.4425, 1.4512, 1.4535, 1.4600

Posted at 11.40 pm EST