Looking for shorts around the 1.3490 region...
For those who read Thursday’s report you may recall that we showed interest in shorting from the 1.35 handle. Ultimately, we wanted to see H4 price print a selling wick that pierced above the H4 supply at 1.3495-1.3485 into 1.35. While this did come to fruition, we chose not to enter for the simple reason that the same H4 candle also boasted an incredibly large buying tail as well.
Having seen 1.35 hold ground, a retest of the H4 support area at 1.3450-1.3437 is a reasonable possibility, in our opinion. Even more so considering that daily price remains trading within the walls of a supply at 1.3494-1.3439, and weekly price is seen trading nearby a strong-looking double-top formation around the 1.3530 neighborhood (see green circle).
Our suggestions: Watch for price to pullback and test the H4 Quasimodo resistance at 1.3490. Ideally, we do not want to see price test the aforementioned H4 support area before striking this level as this would be the first take-profit target. Also, as price could possibly test the 1.35 handle again, we would advise waiting for a H4 bearish candle to form (preferably with a full-bodied close) before pulling the trigger.
Data points to consider: FOMC member Kashkari speaks at 2.30pm. Canadian inflation data at 1.30pm GMT+1.
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: 1.3490 region (waiting for a reasonably sized H4 bear candle to form before pulling the trigger is advised, stop loss: ideally beyond the candle’s wick).
Having seen 1.35 hold ground, a retest of the H4 support area at 1.3450-1.3437 is a reasonable possibility, in our opinion. Even more so considering that daily price remains trading within the walls of a supply at 1.3494-1.3439, and weekly price is seen trading nearby a strong-looking double-top formation around the 1.3530 neighborhood (see green circle).
Our suggestions: Watch for price to pullback and test the H4 Quasimodo resistance at 1.3490. Ideally, we do not want to see price test the aforementioned H4 support area before striking this level as this would be the first take-profit target. Also, as price could possibly test the 1.35 handle again, we would advise waiting for a H4 bearish candle to form (preferably with a full-bodied close) before pulling the trigger.
Data points to consider: FOMC member Kashkari speaks at 2.30pm. Canadian inflation data at 1.30pm GMT+1.
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: 1.3490 region (waiting for a reasonably sized H4 bear candle to form before pulling the trigger is advised, stop loss: ideally beyond the candle’s wick).
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