DAILY REVIEW 5 April 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 (589pips) bull closing at the high on low vol<1month. The candle close and volume suggests more upside.  

WEEK- The candle is an above average spread (285pips) bull closing near the high on low vol>1week. The candle close and volume suggests more upside. 

DAY- The candle is a small spread (55pips) bear closing 1/2 off the low on low vol<4days. The candle close and volume suggests no selling pressure. 

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: Last Friday's NFP data was largely positive although the unemployment rate was revised to 5% from 4.9% with other adjustments negligible. The FED's dovish stance as espoused by FED Chair Janet Yellen leaves the USD in limbo, the market ignoring rate hike rhetoric by other FED members. The FOMC Minutes release this week will be telling.

Oanda order book:  Trapped short volumes are overwhelmingly significant. 

Potential demand stacks:  1.1303-1.1295, 1.1285-1.1267, 1.1257-1.1228, 1.1211-1.1200, 1.1153-1.1140

Potential supply stacks: not applicable

Potential long (trapped) stops:  1.1290-1.1285
Potential short (trapped) stops: 1.1402-1.1417, 1.1432-1.1450, 1.1495-1.1544, 1.1550-1.1605, 1.1612-1.1622

There is the US ISM data later today. With the trapped shorts in the majority, SM is likely to maintain buying pressure to retest the current high 1.1438 or higher before retracing to fade weak longs, the daily volume divergence will come into play.

EU long levels: 1.1350, 1.1290-1.1284,1.1272, 1.1253

EU short levels: 1.1450, 1.1494-1.1505, 1.1527-1.1540, 1.1600, 1.1619-1.1630, 1.1711

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 an above average spread (610pips) bull closing off the high on low vol<1month. The candle close and volume suggests more upside.

WEEK- The candle is an above average spread (340pips) bull "upthrust" closing on low vol>1week. The candle close suggests initial buying.
DAY- The candle is a near normal spread (131pips) bear closing 1/2 off the high on low vol<4days. The candle close and volume suggests no selling pressure. 

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

The Oanda order book: Volume is very thin and there is no significant trapped volume at this point in time.

Potential demand stacks: 1.4100, 1.4000
Potential supply stacks: 1.4495-1.4511, 1.4600-1.4615

Potential long (trapped) stops:  1.4255-1.4212, 1.4195-1.4178, 1.4170-1.4160

Potential short (trapped) stops: 1.4272-1.4290, 1.4315-1.4352, 1.4372-1.4391, 1.4465-1.4475, 1.4500-1.4515

Yesterday's UK Construction PMI was reasonably good yet prices fell shortly after. We have the UK services data later. SM is is likely to fade weak shorts to retest 1.4300 or higher before reversing.

GU long levels: 1.4255, 1.4170, 1.4100-1.4090, 1.4000-1.3990

GU short levels: 1.4300, 1.4330-1.4350, 1.4365-1.5385, 1.4400-1.4410, 1.4450-1.4460, 1.4485, 1.4515, 1.4600

Posted at 11.57 pm EST