DAILY REVIEW 4 May 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 a low spread (250pips) bull hammer closing on low vol<19months. The candle close and volume suggests more upside.  

WEEK- The candle is an above average spread (244pips) bull closing at the high on low vol>2weeks. The candle close and volume suggests more upside.

DAY- The candle is an above average spread (121pips) bear upthrust closing at the low on high vol>1day. The candle close and volume suggests more downside but structurally it looks like another bear trap set in place.

Levels of interest: Demand: Daily/Weekly:  1.0000  

Background: With there being no clear deadline for the much expected FED rate hike and less than stellar data, the USD continues to weaken. 

Oanda order book:  Volumes remain thin but weak trapped longs have appeared from around the 1.1470 level.

Potential demand stacks:  1.1335-1.1320, 1.1280-1.1265, 1.1246-1.1230, 1.1210-1.1195, 1.1151-1.1135

Potential supply stacks: not applicable

Potential long (trapped) stops:  1.1480-1.1464
Potential short (trapped) stops: 1.1543-1.1516, 1.1600-1.1632, 1.1644-1.1655

Yesterday I wrote, "This is NFP week and we can expect the accumulative pressure built up to push prices towards the next structure levels above." Well, it did push and then they pulled the bottom out and prices tanked after the steep rise. ForexLive stated "The drivers were unclear. Commodities were soft and there was some risk aversion but there were no good correlations. It's all flows at the moment." Yes indeed it is all about flows because there were no more orders "up there" and hence it had to fall. Today we have Euro and US data releases and we can expect SM to continue the selling pressure to the 1.1460 level or lower before reversing.

EU long levels: 1.1450, 1.1430, 1.1350, 1.1320, 1.1310-1.1300, 1.1275-1.1260, 1.1250-1.1240, 1.1228

EU short levels:  1.1520, 1.1575, 1.1590, 1.16001.1615, 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 (665pips) bull hammer closing on low vol<2months. The candle close and volume suggests more upside.

WEEK- The candle is a below average spread (267pips) bull spinning top closing on low vol>8weeks. The candle close and volume suggests more upside.
DAY- The candle is a ultra-large spread (240pips) bear upthrust closing at the low on very high vol>32days. 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: Newly trapped and profitable volumes are around the 1.4665-1.4690 level.

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

Potential long (trapped) stops:  1.4516-1.4480, 1.4446-1.4436

Potential short (trapped) stops: 1.4543-1.4550, 1.4624-1.4646, 1.4675-1.4693, 1.4758-1.4780, 

SM used th epoor UK data yesterday to tank prices, the poor UK Consruction PMI only extends the move.  SM is likely to maintain selling pressure to the 1.4460 level or lower before reversing.

GU long levels:  1.4460, 1.4445-1.4432, 1.4405-1.4400, 1.4367, 1.4335, 1.4310, 1.4300

GU short levels: 1.4554, 1.4633, 1.4700-1.4712, 1.4730, 1.4770, 1.4790, 1.4800 

Posted at 4.59 am EST