DAILY REVIEW 4 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. 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 below average spread (213pips) bear closing at the low on low vol<3weeks. The candle close suggests more downside.  

DAY- The candle is a normal spread (117pips) bull closing near the high on low vol>1day. The candle close and volume suggests more upside.

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: Over the weekend, the G20 leaders agreed on "cooperation" to use all policy measures available for stability but apparently with nothing specific on currency manipulation. In essence, a lot of hot air with more of the same.

Oanda order book:  trapped shorts continue to form the bulk of the volume distribution.  

Potential demand stacks:  1.0869-1.0845

Potential supply stacks: 1.1092-1.1105

Potential long (trapped) stops:  not applicable
Potential short (trapped) stops: 1.1064-1.1092 

Welcome to NFP Friday! Yesterday I wrote, "SM is likely to fade weak shorts to the 1.0978 level or higher" and prices already hit a high of 1.0989 today. SM is likely to test 1.1068 or higher before reversing to continue the downtrend.

EU long levels: Not applicable

EU short levels: 1.1065, 1.1093, 1.1135

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 an ultralarge spread (537pips) bear closing at the low on very high vol>1week. The candle close and volume suggests more downside.
DAY- The candle is a large spread (161pips) bull closing near the high on low vol<21days. The candle close 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 trapped shorts forming the bulk of the volume distribution.

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

Potential long (trapped) stops:  1.3836-1.3825, 1.3650-1.3600, 1.3570-1.3550

Potential short (trapped) stops: 1.4191-1.4240, 1.4309-1.4330

SM is likely to continue fade weak shorts to the 1.4275 level or higher before reversing to continue the down move.

GU long levels: Not Applicable

GU short levels: 1.4275, 1.4330, 1.4395, 1.4420, 1.4485, 1.4500, 1.4600-1.4615, 1.4665-1.4680

Posted at 7.40 am EST