Following a rather aggressive opening to the week, a strong wave of bids came into this market from the H4 mid-way support line at 0.7450. As can be seen from the H4 chart this buying continued throughout the day, with the commodity currency topping out at highs of 0.7544.
Daily supply at 0.7517-0.7451, along with its partner supply on the H4 chart at 0.7514-0.7486, were both taken out (both now acting demands) which has likely cleared the runway north for prices to challenge the 0.76 handle. The 0.76 level, as you’ll see by looking across to the weekly chart, also represents a well-established weekly resistance line at 0.7604.
Our suggestions: Buying this market up to the 0.76 handle is possible, in our opinion. For us to be given the green light to trade this move, nevertheless, a retest of the recently broken H4 supply as demand, followed by a lower timeframe buy signal would need to be seen, as per the green arrows.
We understand that most traders will likely have their own techniques to confirm entry. For us, we tend to keep it simple. Either a break of supply followed by a subsequent retest, a trendline break/retest or simply a collection of well-defined buying tails around the higher timeframe area would sufficient enough to confirm strength. Stops are usually placed 5-10 pips beyond confirming structures.
Daily supply at 0.7517-0.7451, along with its partner supply on the H4 chart at 0.7514-0.7486, were both taken out (both now acting demands) which has likely cleared the runway north for prices to challenge the 0.76 handle. The 0.76 level, as you’ll see by looking across to the weekly chart, also represents a well-established weekly resistance line at 0.7604.
Our suggestions: Buying this market up to the 0.76 handle is possible, in our opinion. For us to be given the green light to trade this move, nevertheless, a retest of the recently broken H4 supply as demand, followed by a lower timeframe buy signal would need to be seen, as per the green arrows.
We understand that most traders will likely have their own techniques to confirm entry. For us, we tend to keep it simple. Either a break of supply followed by a subsequent retest, a trendline break/retest or simply a collection of well-defined buying tails around the higher timeframe area would sufficient enough to confirm strength. Stops are usually placed 5-10 pips beyond confirming structures.
IC Markets is an online forex broker specialized in providing transparent trading solutions to both retail and institutional investors alike. We provide superior execution technology, lower spreads and unrivaled liquidity.