EUR/USD – New Lower Low
After managing to move higher for most of yesterday, it looked as though the retracement may be at an end. Today we have seen that this is not the case as the price has dropped below the lows made yesterday.
The selling which is caused this current move down came into the market around the time of the London open. There was a large drop which culminated with the previous low being broken at which point a small retracement began. The retracement only lasted for three hours before dropping lower again to where the market is now.
USD/JPY – Retracement Low Nearly Broken
The low of the retracement USD/JPY spent 20 days in is very close to being broken, a drop earlier today put the market within 25 pips of penetrating the low but since then we have seen a slight up-move take place.
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Since these two lows are quite close together it could be a sign that we might be seeing the start of a retracetment higher. In order for this to be confirmed we need to see the market break above the highs marked in the image. Once these highs are broken it would signal a change of momentum back to the upside and we may need to wait for the downside momentum to return to the market before going short again.
Tomorrow watch to see if the market is able to break the highs in the image or if it fails to break past the new low made earlier today.
AUD/USD – Dropping Deeper Into Daily Demand
Yesterday we saw the price rise up after the 1 hour demand zone which was inside a larger daily demand zone was hit. I said in my post how I thought it was unlikely for the price to continue advancing from the 1 hour demand and how there was a much higher chance of the price falling back into the daily demand before moving higher.
Now the market has fallen into the daily demand zone we have seen the price make a sharp move higher. This could be the beginning of the move higher but we must see the market break above the high of the move down we saw today for the up-side momentum to be confirmed. For now I would watch the low of this move up for signs of a failure to break lower, Ideally we want to see a bullish engulfing candle form at the current low before going long.