Thursday 2nd April: Daily technical outlook and review (Australia and New Zealand bank holidays today).

EUR/USD:

Weekly timeframe perspective: The upward momentum from the weekly demand area at 1.0333-1.0502 seems to be crumbling, as active sellers appear to be entering the market just below a major weekly swap level coming in at 1.1096.

Daily timeframe perspective: From the daily timeframe, we can see that the sellers have so far managed to maintain a position below the daily swap level 1.0825. Assuming that they can dig in deep and defend this barrier, we may see a move south towards the daily demand area seen at 1.0461-1.0565, which, if you look back to the weekly chart, you’ll notice that this area was in actual fact a reaction to the larger weekly demand area mentioned above.

4hr timeframe perspective: On Wednesday, we saw price rally higher and collide with active sellers located just below 1.0800, which, as you can see, is currently holding the market lower.

In view of the higher-timeframe technical structure (see above in bold), the EUR/USD outlook remains relatively negative in our opinion. With this in mind, our team’s main focus for today will be looking for CONFIRMED sell trades around either 1.0800, or the small 4hr decision-point supply area seen just above it at 1.0844-1.0809. This area of 4hr supply is particularly significant to us, as it was here pro money likely made the decision to break below the aforementioned daily swap level. Should a short entry be seen at either of the aforementioned 4hr zones, we have two targets in mind. The first comes in at 1.0700, the second, at a relatively fresh-looking 4hr demand area seen at 1.0612-1.0658.

These two 4hr hurdles are, as far as we can see, all that’s stopping price from reaching the daily demand area mentioned above at 1.0461-1.0565 (see the daily timeframe analysis above).

Current buy/sell orders:

• Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
• Sell orders: 1.0800 [Tentative – confirmation required] (Predicative stop-loss orders seen at: dependent on where one confirms this level) 1.0844-1.0809 [Tentative – confirmation required] (Predicative stop-loss orders seen at: 1.0851).

GBP/USD:

Weekly timeframe perspective: From this angle, we can see that the sellers are managing to hold the market below a recently broken weekly Quasimodo support (now resistance) level at 1.5007. In the event that further downside is seen from here, we could eventually see price drop as far as the major weekly demand area coming in at 1.4225-1.4482.

Daily timeframe perspective: The daily timeframe on the other hand, shows that in order for further selling to be seen on the weekly timeframe, the sellers must take out a daily demand area positioned at 1.4643-1.4823.

4hr timeframe perspective: The GBP/USD pair is currently seen swinging between the 1.4866 level and a 4hr demand area coming in at 1.4721-1.4767 (located within the aforementioned daily demand area).Considering the somewhat conflicting signals seen between the higher-timeframe structures (see above) at the moment, our team remains hesitant trading this pair medium/long term.

However, we are still very keen on trading this pair intraday, levels we have our eye on are as follows:

Buys:

• 4hr demand at 1.4721-1.4767.
• 4hr Quasimodo support level seen at 1.4698.

Sells:

• Minor 4hr Quasimodo resistance at 1.4866.
• Fresh 4hr supply seen at 1.4919-1.4896.

In trading the above areas, we highly recommend waiting for the lower timeframe structure to confirm buying or selling strength around your chosen zone.

Current buy/sell orders:

• Buy orders: 1.4721-1.4767 [Tentative – confirmation required] (Predicative stop-loss orders are seen at: 1.4714) 1.4698 [Tentative – confirmation required] (Predicative stop-loss orders are seen at: dependent on where one confirms this level).
• Sell orders: 1.4866 [Tentative – confirmation required] (Predicative stop-loss orders are seen at: dependent on where one confirms this level) 1.4919-1.4896 [Tentative – confirmation required] (Predicative stop-loss orders are seen at: 1.4925).

AUD/USD:

Weekly timeframe perspective: For the past two months, the buyers and sellers have been seen pulling for position around the upper limit of a long-term weekly demand area seen at 0.7449-0.7678. Also, if you take a look back to early 2001, you’ll notice that this weekly area boasts strong trendline support from the low 0.4775.

Daily timeframe perspective: The current view we have of the daily chart shows us that price is once again tackling the topside of a daily demand area seen at 0.7449-0.7598 (located deep within the aforementioned weekly demand area).

4hr timeframe perspective: From the 4hr timeframe, we can see that price was driven extremely deep into a 4hr decision-point supply area at 0.7663-0.7639, which, as you can see, clearly found enough resistive pressure to support a counterattack down to the 4hr Quasimodo support level at 0.7587 (located just within the aforementioned daily demand area).

Given that both the weekly and daily timeframes are collectively in demand (see above) at the moment, we could potentially see a rally north from here. That said though, with the long-term downtrend still very much in play, and the fact that price is being held lower by the aforementioned 4hr decision-point supply area at the moment, we remain skeptical. Waiting for price to break above this 4hr decision-point supply area seems to be the most conservative route to take. This move would not only tell us that potential strength was entering the market from the higher-timeframe demand areas, but also that the path north is likely clear for potential ‘resistance-free’ buying up to at least the 0.7700 level.

Therefore, with no tradable price action for us on this pair at present, opting to stand on the side lines here may very well be the best path to take.

Current buy/sell orders:

• Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

USD/JPY:

Weekly timeframe perspective: At the time of writing, we can clearly see that the buyers and sellers are battling for position within a small weekly decision-point demand area coming in at 118.22-119.40. Assuming that the buyers are victorious here, it is likely we’ll see price attack the weekly Quasimodo resistance level seen at 122.18.

Daily timeframe perspective: Following the recent move north from daily support at 118.32 (located deep within the aforementioned small weekly decision-point demand area), resistance now appears to be forming around the 120.11 region. It will be interesting to see what the 4hr timeframe makes of this…

4hr timeframe perspective: The 4hr timeframe shows that price is currently being contained between two 4hr Quasimodo levels. Upward resistance comes in at 120.21, while support is being seen at 119.42.

Taking into account that price is holding within weekly demand (see above) at the moment, and that the overall weekly trend is still strong, we’re confident higher prices will eventually be seen. Therefore, our main focus for today will be on the 119.42 4hr Quasimodo support level. Waiting for lower timeframe confirmation here is highly recommended, since there is nothing to say a sharp fakeout below this level will not be seen. Should this level be consumed, we’ll then shift our attention to the 4hr demand area seen below it at 118.91-119.13. This 4hr area may, and we emphasize the word ‘may’ here, be good enough to allocate a pending buy order. Nonetheless, before doing that, we would like to see how price approaches this zone before making any final decisions…

Current buy/sell orders:

• Buy orders: 119.42 [Tentative – confirmation required] (Predicative stop-loss orders seen at: dependent on where one confirms this level) 118.91-119.13 [undecided whether to wait for confirmation or trade with a pending order] (Predicative stop-loss orders seen at: 118.87).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

USD/CAD:

Weekly timeframe perspective: For the past two months, price has been seen teasing the underside of the weekly Quasimodo resistance level at 1.2765. A break above this number would likely clear the path north for further buying towards another weekly Quasimodo resistance level seen at 1.3014.

Daily timeframe perspective: Following the pin-bar rebound seen from daily supply at 1.2833-1.2747 (surrounds the aforementioned weekly Quasimodo resistance level); further downside was seen in the market yesterday. In the event that the sellers can continue with this tempo, it is likely price will challenge daily demand coming in at 1.2405-1.2517.

4hr timeframe perspective: The 4hr timeframe shows that price retested the 1.2700 handle as resistance, and then aggressively sold off, breaking1.2600 in the process and crashing into a small 4hr decision-point (DP) demand area at 1.2562-1.2582, which, as you can see, is currently supporting the buyers.

Now, with price currently trading from resistive structures on both the weekly and daily timeframes, it’s quite hard for us, from a technical standpoint, not to be bearish here, even though price is trading from a 4hr (DP) demand area at the moment.

Taking all of the above into consideration, this is how we intend to play this pair today. Our team has come to a general consensus that no buying shall be initiated at the current 4hr (DP) demand area, the risk from higher-timeframe sellers pounding this area is just too great for us.

In the event that we see price break below this area of 4hr demand, we’ll then begin watching for price to retest this area as supply.

Current buy/sell orders:

• Buy orders: Flat (Predicative stop-loss orders seen at: N/A).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

USD/CHF:

Weekly timeframe perspective: The current situation on the weekly chart shows us that price is respecting the 0.9663 weekly swap level as resistance for the time being. Let’s take a look to see how the lower timeframes have responded to this…

Daily timeframe perspective: Selling pressure came into the market yesterday from just below a daily decision-point supply area at 0.9904-0.9771, which consequently forced price back below the aforementioned weekly swap level.

4hr timeframe perspective: The recent descent on the 4hr timeframe shows price took out both a round-number level at 0.9700, and also a small 4hr decision-point (DP) demand area at 0.9654-0.9678. This move very likely cleared the path south down to at least 0.9600.

With all of the above in mind, the Swissy could do one of three things today:

1. With path south likely clear, price could simply sell off and hit 0.9600, but for that to happen, well-funded traders would require buyers to sell into.
2. Price could rally and retest 0.9700 as resistance for the second time, and then sell off.
3. Assuming that the 0.9700 level fails to hold as resistance, we will then likely see price challenge a fresh 4hr supply area seen at 0.9811-0.9767 (located just within the aforementioned daily decision-point supply area).

Our team collectively favors number three. The reason why is simply because the liquidity (in this case buy stops) from a rally above 0.9700, and the minor swing highs seen at 0.9741/0.9755 would be what pro money likely require to short this market. That being the case, a pending sell order has been set just below this 4hr zone at 0.9763 with a stop placed just above at 0.9822.

Current buy/sell orders:

• Buy orders: Flat (Predicative stop-loss orders seen at: N/A)
• Sell orders: 0.9763 (Predicative stop-loss orders seen at: 0.9822).

DOW 30:

Weekly timeframe perspective: The weekly picture shows that even though the DOW is still in a VERY strong uptrend, resistive pressure is currently being seen from a minor weekly resistance level coming in at 18098.

Daily timeframe perspective: (Slightly revised from previous analysis) The daily timeframe on the other hand, reveals that in order to for further selling to be seen on the weekly timeframe, the sellers must take out a small daily decision-point demand area at 17561-17655.

4hr timeframe perspective: From the 4hr timeframe, we can see that price reacted just beautifully to a 4hr demand area coming in at 17546-17633, which, if you look back to the daily chart, you’ll notice is located deep within the aforementioned small daily decision-point demand area.

Taking all of the above (in bold) into consideration, where do we go from here on the 4hr chart? Well, one could look to enter long (with lower timeframe confirmation) around the current 4hr demand area, which. As you can see, has clearly attracted buying interest over the past day or so.

However, in the event that price pushes below both this area, and the small 4hr ‘kink’ demand at 17514-17565 seen supporting it, we can likely wave goodbye to the daily decision-point demand area mentioned above, which, in turn, will also likely confirm selling strength from the aforementioned minor weekly resistance level.

Current buy/sell orders:

• Buy orders: 17546-17633 [Tentative – confirmation required] (Predicative stop-loss orders seen at: 17537).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

XAU/USD (Gold):

Weekly timeframe perspective: From this angle, we can see that the buyers and sellers are wrestling for position within a small weekly decision-point supply area at 1223.1-1202.6. A cut above here would likely see further upside towards a weekly swap level coming in at 1251.0.

Daily timeframe perspective: Yesterday’s trading action saw price rocket north from a major daily swap level positioned at 1182.0. Provided that the buyers can continue with this momentum, price will very likely collide with a daily supply area at 1223.1-1213.0 (located deep within the aforementioned weekly decision-point supply area).

4hr timeframe perspective: For those who read our last report on Gold, you may recall us mentioning to watch for price to retest the 4hr Quasimodo support line at 1182.3 (positioned just above the aforementioned major daily swap level). The reaction from this level was far more aggressive than we expected; we do hope some of our readers took advantage of this move!

Moving swiftly on, resistance now appears to be forming around the 1208.4 region. Should this level be strong enough to hold Gold lower today, we may see price challenge a small 4hr decision-point demand area at 1191.3-1194.1. We believe this area will produce a bounce if tested. How much of a bounce is anybody’s guess, since let’s not forget that even though the daily timeframe indicates room for price to move further northbound, the weekly chart on the other hand, shows price trading within weekly supply (see above). Therefore, should anyone wish to trade this area if price hits, lower timeframe confirmation is strongly advised here!

Current buy/sell orders:

• Buy orders: 1191.3-1194.1 [Tentative – confirmation required] (Predicative stop-loss orders seen at: 1190.2).
• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

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