Well done to those who shorted with us yesterday - 1.07 next?
For those who read Wednesday’s report on the EUR you may recall that our desk executed a market sell order at 1.0798, with a stop placed at 1.0824. Fueled by the upbeat numbers seen from both the US ADP non-farm employment change and US manufacturing PMIs, the trade struck the H4 support area at 1.0765-1.0753 during yesterday’s sessions. 50% of the position was taken off the table, and risk was also reduced to breakeven. The final take-profit zone, according to our team, is set around the 1.07 neighborhood which is sited only a few pips south of daily support coming in at 1.0710.
Why we entered short where we did was due to the following converging structures: a H4 Quasimodo resistance level at 1.0796, a 1.08 handle, a H4 88.6% Fib resistance at 1.0810, Weekly resistance at 1.0819 and a H4 symmetrical AB=CD approach terminating at 1.0805. Well done to any of our readers who jumped on board here!
Our suggestions: Although there is a chance that price may retest the above noted H4 sell zone today, thereby taking us out of the current position, an additional retest could offer traders (and us) a second opportunity to trade this area. Why would we look to enter here when the zone may have been weakened by yesterday’s decline? Good question! Well, apart from the fact that weekly resistance at 1.0819 is now IN PLAY, stops below the H4 support area mentioned above at 1.0765-1.0753 have also very likely been taken out, thus clearing the path south down to 1.07ish.
Data points to consider: ECB President Draghi speaks at 12.15 pm. US Jobless claims at 1.30pm GMT.
Why we entered short where we did was due to the following converging structures: a H4 Quasimodo resistance level at 1.0796, a 1.08 handle, a H4 88.6% Fib resistance at 1.0810, Weekly resistance at 1.0819 and a H4 symmetrical AB=CD approach terminating at 1.0805. Well done to any of our readers who jumped on board here!
Our suggestions: Although there is a chance that price may retest the above noted H4 sell zone today, thereby taking us out of the current position, an additional retest could offer traders (and us) a second opportunity to trade this area. Why would we look to enter here when the zone may have been weakened by yesterday’s decline? Good question! Well, apart from the fact that weekly resistance at 1.0819 is now IN PLAY, stops below the H4 support area mentioned above at 1.0765-1.0753 have also very likely been taken out, thus clearing the path south down to 1.07ish.
Data points to consider: ECB President Draghi speaks at 12.15 pm. US Jobless claims at 1.30pm GMT.
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