Harmonic Gartley reversal zone at 1.1725/1.1752 eyed...
Weekly gain/loss: - 58 pips
Weekly closing price: 1.1861
After seeing the EUR/USD shake hands with the weekly resistance level at 1.2044, a strong succession of sell orders reigned over this market last week. As a result of this, the week ended with price marginally closing beyond weekly support pegged at 1.1871. Inversely, we also saw the USDX weekly support at 11854 hold firm and print a weekly indecision candle going into the close. Although a close has been seen below support on the EUR, it may be worth waiting for the piece to print a somewhat deeper move beyond this line before presuming that all bids are consumed here.
Down on the daily timeframe, we can see that demand at 1.1739-1.1823 came into play on Thursday (USDX daily supply also came into view on Thursday at 11969-11938). A violation of this area could send the unit down to a demand positioned at 1.1612-1.1684, which happens to fuse nicely with a trendline support fixed from the low 1.0839.
On Friday, the H4 candles moved aggressively higher in the immediate aftermath of a soft US job’s report. However, despite this, the pair was unable to sustain gains beyond resistance at 1.1962, and ended the day closing back below the 1.19 handle.
Suggestions: Apart from breaching the 1.19 handle, H4 price also opened up the trapdoor for the major to challenge August’s opening level seen nearby at 1.1830, followed closely by the 1.18 boundary. Technically speaking though, our desk has absolutely no interest in these levels, as lurking just below is a H4 Harmonic Gartley reversal zone (PRZ) marked in green at 1.1725/1.1752. Not only does this area boast a H4 mid-level support at 1.1750 and a 161.8% H4 Fib ext. point at 1.1725 (taken from the high1.2070), it is also located around the lower limits of the daily demand mentioned above at 1.1739-1.1823.
As far as we see things, there are two options here:
1. Place a pending order at 1.1750 and position the stop below the X point of the Harmonic formation at 1.1660.
2. Wait for H4 price to connect with the PRZ and let the H4 candles prove buyer intent. Personally, we look for at least a full, or near-full-bodied bullish to materialize before pulling the trigger. Should this come to fruition, stops can either be placed beyond the candle’s tail (aggressive), or a few pips outside of the PRZ.
Data points to consider: No high-impacting news events on the docket today (US banks are closed in observance of Labor Day).
Weekly closing price: 1.1861
After seeing the EUR/USD shake hands with the weekly resistance level at 1.2044, a strong succession of sell orders reigned over this market last week. As a result of this, the week ended with price marginally closing beyond weekly support pegged at 1.1871. Inversely, we also saw the USDX weekly support at 11854 hold firm and print a weekly indecision candle going into the close. Although a close has been seen below support on the EUR, it may be worth waiting for the piece to print a somewhat deeper move beyond this line before presuming that all bids are consumed here.
Down on the daily timeframe, we can see that demand at 1.1739-1.1823 came into play on Thursday (USDX daily supply also came into view on Thursday at 11969-11938). A violation of this area could send the unit down to a demand positioned at 1.1612-1.1684, which happens to fuse nicely with a trendline support fixed from the low 1.0839.
On Friday, the H4 candles moved aggressively higher in the immediate aftermath of a soft US job’s report. However, despite this, the pair was unable to sustain gains beyond resistance at 1.1962, and ended the day closing back below the 1.19 handle.
Suggestions: Apart from breaching the 1.19 handle, H4 price also opened up the trapdoor for the major to challenge August’s opening level seen nearby at 1.1830, followed closely by the 1.18 boundary. Technically speaking though, our desk has absolutely no interest in these levels, as lurking just below is a H4 Harmonic Gartley reversal zone (PRZ) marked in green at 1.1725/1.1752. Not only does this area boast a H4 mid-level support at 1.1750 and a 161.8% H4 Fib ext. point at 1.1725 (taken from the high1.2070), it is also located around the lower limits of the daily demand mentioned above at 1.1739-1.1823.
As far as we see things, there are two options here:
1. Place a pending order at 1.1750 and position the stop below the X point of the Harmonic formation at 1.1660.
2. Wait for H4 price to connect with the PRZ and let the H4 candles prove buyer intent. Personally, we look for at least a full, or near-full-bodied bullish to materialize before pulling the trigger. Should this come to fruition, stops can either be placed beyond the candle’s tail (aggressive), or a few pips outside of the PRZ.
Data points to consider: No high-impacting news events on the docket today (US banks are closed in observance of Labor Day).
Penafian
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