• The 1.25 handle.
• A H4 resistance taken from the low 1.2346.
• An 88.6% H4 retracement seen at 1.2518.
• A daily Quasimodo coming in at 1.2523.
• All of the above structures are located within weekly supply positioned at 1.2569-1.2404.
Well done to any of our readers who took advantage of this move yesterday.
Moving forward, we can see that daily support was brought into play yesterday at 1.2430. The rebound from here is considered strong, in our book. As a result, this could force daily price to challenge the daily Quasimodo resistance at 1.2523 sometime today, which as we already know is housed within the aforementioned weekly supply.
Our suggestions: With offers now likely weakened around the 1.25 boundary from yesterday’s move, our focus turns to the daily Quasimodo resistance seen just above it at 1.2523. Merging closely with the H4 resistance taken from the low 1.2346, an 88.6% H4 retracement seen at 1.2518 and not forgetting where this daily line is positioned on the (see above), we’ll be (dependent on the time of day) looking to short from here with stops placed above the weekly supply at 1.2571.
Data points to consider: MPC member Broadbent speaks at 9.15am, UK retail sales at 9.30am. US jobless claims at 12.30pm, Fed Chair Janet Yellen speaks at 12.45pm, US new home sales at 2pm, FOMC member Kashkari speaks at 4.30pm, FOMC member Kaplan speaks at 11pm GMT .
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: 1.2523 region (stop loss: 1.2571).