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 below average spread (69pips) bear "spring" closing on low vol<1day. The candle close and volume suggests buying. 

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 remain 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:  1.1335-1.1325
Potential short (trapped) stops: 1.1380-1.1390, 1.1402-1.1418, 1.1437-1.1450, 1.1500-1.1550, 1.1564-1.1582, 1.1600-1.1608, 1.1626-1.1633

Yesterday's ISM Manufacturing data suggests that the US economy is "humming along nicely" according to ISM's Nieves. This resulted in the whipsaw and the bears jumping in as SM seemingly reversed positions which looking at the net (retail) positions is unlikely. There is the FOMC Minutes release later today which is likely to give the whipsaw to clear the deck and move back up. With the trapped shorts in the majority, SM is likely to maintain buying pressure to retest the current high 1.1400 key level or higher before retracing to fade weak longs, the daily volume divergence remains in play.

EU long levels: 1.1350, 1.1320, 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 an above average spread (157pips) bear closing near 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: Volume is very thin and a slightly more trapped short volume at this point in time.

Potential demand stacks: not significant
Potential supply stacks: not significant

Potential long (trapped) stops:  1.4128-1.4108, 1.4051-1.4041

Potential short (trapped) stops: 1.4167-1.4220, 1.4232-1.4241, 1.4251-1.4285, 1.4335-1.4346

Prices fell despite decent UK data the past two days. There is no high impact UK news today but FOMC minutes release will drive this pair. SM is is likely to fade weak shorts to the 1.4200 key level or higher before reversing.

GU long levels:  1.4130, 1.4100-1.4090, 1.4000-1.3990

GU short levels: 1.4200, 1.4225, 1.4243, 1.4265, 1.4290,1.4300, 1.4342-1.4350, 1.4365-1.5385, 1.4400-1.4410, 1.4450-1.4460, 1.4485, 1.4515, 1.4600

Posted at 1.34 am EST