Much the same as Friday’s analysis, the buyers were seen making an advance towards weekly supply at 1.76290-1.70490, a small reaction has been seen forming what the majority of traders may call an ‘indecision candle’.
Any long trades taken on the lower timeframes will now have to be done with caution as well-funded long-term traders may be looking to short this area, or even liquidate their long positions here, thus creating a sell off.
The daily timeframe shows the buyers have attempted to consume some of the sellers around daily supply at 1.70410-1.68880 with two wicks/spikes being seen above it.
As already mentioned above, weekly timeframe supply (1.76290-1.70490) has just been hit, so this break of daily supply (levels above) could just be a fakeout to stop out sellers, and break out buyers, for the overall bigger push down.
The weekly close came in at 1.70135 just above the big figure number 1.70000, meaning if the two wicks seen above daily supply (levels above) was indeed a fakeout, the first trouble area would in fact be the round number just mentioned above, and then eventually the S/R flip level just below at 1.69210, So, it will be interesting to see what price action unfolds this coming week.
A Sharp decline was seen on Friday, right into the round number 1.70000, with a slight bullish reaction being seen.
Traders will need to be very careful going long around this big figure level (level above) as already explained above, we are currently trading at the base of weekly supply (1.76290-1.70490) so price could turn bearish at any time without warning! So, as always expect the unexpected!
Pending/P.A confirmation orders:
- Pending buy orders (Green line) are seen at 1.67610 just above demand at 1.67378-1.67583. A pending order is valid here due to the momentum away from the demand area, indicating orders may be left unfilled here.
- P.A confirmation buy orders (Red line) are seen just above the round number 1.68000 at 1.68038. A reaction may be likely here because of the way pro money used this level to rally prices higher with force, a quick change in direction like this likely indicates pro money activity, thus, all of their orders may have not been filled at that time. The reason a pending order is not used here is because pro money, on a regular basis perform deep stop hunts around big figure levels (1.68000), and these tails/wicks can be huge sometimes, hence the need to wait for confirmation.
- P.A confirmation buy orders (Red line) are seen just above minor support (1.69431) at 1.69482. A reaction north is likely to be seen here, however we are currently seeing higher-timeframe supply being hit on the weekly timeframe at 1.76290-1.70490, hence the need for a confirmation buy order, rather than a pending buy order.
- The P.A confirmation buy order (Red line) set just above the round number 1.70000 at 1.70034is now active. For this level to be confirmed, buyers will need to rally price and consume the majority of sellers around the high marked with an x at 1.70597, a pending buy order can then be set, awaiting a possible retracement.
- No pending sell orders (Green line) are seen in the current market environment.
- No P.A confirmation sell orders (Red line) are seen in the current market environment.
The confirmation buy order seen just above the round number 1.70000 at 1.70034 has been hit, buyers will need to rally price from here to confirm this level, however do be aware, we have just hit higher-timeframe weekly supply at 1.76290-1.70490 so a sell off could be seen very soon, so do remain vigilant!
- Areas to watch for buy orders: P.O: 1.67610 (SL: 1.67345 TP:  1.68000  1.69000 [likely to be changed, depending on price approach]). P.A.C: 1.68038 (SL: Dependent on approaching price action after the level has been confirmed TP: Dependent on approaching price action after the level has been confirmed). 1.69482 (likely to be set at 1.69176 TP: Dependent on approaching price action after the level has been confirmed) 1.70034 (Active-awaiting confirmation) (SL: likely to be set at 1.69811 TP: Dependent on approaching price action after the level has been confirmed).
- Areas to watch for sell orders: P.O: No pending sell orders seen in the current market environment. P.A.C: No P.A confirmation sell orders seen in the current market environment.
For the readers’ benefit:
Price action confirmation: simply means traders will likely wait for price action to confirm a level by consuming the opposing supply or demand area, then entering a trade on a possible retracement, this may occur on the lower timeframes also.
Pending orders: means pending orders are likely seen.
Sources: IC Markets Trading Desk