DAILY REVIEW 16 March 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 and January's candle is an "inside" of the December candle while February's candle also closed back inside the January range. 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 an above average spread (561pips) upthrust closing on average vol>7months. The candle close and volume suggests more downside. 

WEEK- The candle is a large spread (395pips) bull closing off the high on average vol>2weeks. The candle close and volume suggests more upside.  

DAY- The candle is a small spread (53pips) bull spinning top closing on low vol<5days. The candle close and volume suggests more downside.

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: Last Friday's NFP figures were strong and as can be expected with the order stacks, made for SM shark feeding. The strong figures basically gave the retail crowd the basis to buy the USD, with EURUSD plunging as shorts were induced by the news release but only to 1.0902 after which SM had sufficient orders to start the upward climb pushing all the way to 1.1042 before initial profit taking.

Oanda order book:  newly trapped longs are now in play plus previously trapped trapped shorts that still form the bulk of the volume distribution. 

Potential demand stacks:  1.1086-1.1059, 1.0810-1.0770

Potential supply stacks: not applicable

Potential long (trapped) stops:  not applicable
Potential short (trapped) stops: not applicable

We have major US data releases today plus the FOMC rate decision and FED Chair Yellen's speech so we can expect extremes today. SM is likely to maintain selling pressure to the 1.1076 level or lower to induce shorts before reversing.

EU long levels: 1.1071, 1.1050-1.1040, 1.0950-1.0940, 1.0850-1.0830

EU short levels: 1.1134, 1.1200, 1.1217, 1.1335

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 large spread (832 pips) bear inverted hammer closing on average vol>10months. The candle close and volume suggests initial buying.

WEEK- The candle is a below average spread (319pips) bull closing near the high on near average vol<7weeks. The candle close and volume suggests more upside.
DAY- The candle is a large spread (167pips) bear closing at the low on low vol>1day. The candle close and volume suggests more downside.

Demand: Weekly/Daily:  1.3705-1.3500 Supply: Short term: 1.5574, 1.5600, 1.5619 

The Oanda order book: volumes are extremely thin with more volume trapped long and newly profitable shorts.

Potential demand stacks: 1.4000-1.3990
Potential supply stacks: Not significant

Potential long (trapped) stops:  1.4116-1.4090, 1.3892-1.3875

Potential short (trapped) stops: 1.4158-1.4193, 1.4264-1.4283,1.4300-1.4316, 1.4429-1.4486, 1.4550-1.4567, 1.4702-1.4713

With the high impact UK employment data out later today, SM is is likely to maintain selling pressure to test the the 1.4100 level or lower before reversing. The volume of newly profitable shorts may come into play and SM may fade them before resuming downward traction.

GU long levels: 1.4100-1.4090, 1.400

GU short levels: 1.4180-1.4200, 1.4603-1.4632, 1.4665-1.4680

Posted at 1.33 am EST