DAILY REVIEW 17 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 very large spread (184pips) bull closing off the high on average vol>2days. The candle close and volume suggests more upside.

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 shorts are now in play. No significant stops above or beneath. 

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

The FED's dovish stance in view of global conditions and the decision to reduce the number of rate rises this year was the catalyst to sell the USD. Significant gap close 1.1253 level from 12 Feb 2016. SM is likely to maintain buying pressure to the 1.1253 level or higher to induce longs before reversing to retest the demand level at 1.1200 for continuation up.

EU long levels: 1.1200, 1.1195, 1.1170, 1.1135-1.1120, 1.1100-1.1090

EU short levels: 1.1253-1.1275, 1.1335, 1.1352, 1.1384, 1.1473

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 an ultralarge spread (221pips) bull closing near the high on high vol>3days. The candle close and volume suggests more upside.

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 slightly more volume trapped short. Otherwise there is no clear significant trapped positions.

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

Potential long (trapped) stops:  1.4242-1.4175, 1.4047-1.4045, 1.3900-1.3890

Potential short (trapped) stops: 1.4286-1.4344, 1.4429-1.4486, 1.4550-1.4567, 1.4702-1.4713

Post-FOMC USD weakness fuelled the rise in GPBUSD. There is major UK data out later today, SM is is likely to maintain buying pressure to test the the 1.4300 level or higher before reversing.

GU long levels: 1.4100-1.4090, 1.400

GU short levels: 1.4315, 1.4395-1.4400, 1.4435, 1.4603-1.4632, 1.4665-1.4680

Posted at 3.45 am EST