Market Commentary 03/03/16

EUR/USD – Rising Out Of Daily Demand


As anticipated yesterday EUR/USD has begun to move out of the daily demand zone.

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It started with a bullish engulfing candle which appeared inside the zone last night. The move higher created by this engulf was not enough to break the highs I said to keep an eye on in my last post, since the highs were not broken it was difficult to determine whether the momentum was now to the upside or still to the downside.

After a slight move lower the market started to advance past the highs, once the highs were breached the market began a rapid accent consisting of multiple large range candle sticks.

Currently the market is overextended, a move lower will possibly occur tomorrow as traders look to take profits off of their trades. Our focus now is on getting long, the support level just below the current price is a likely to look for a bounce if the market decides to return.

USD/JPY – Bearish Pin Bar On Daily Chart


I mentioned yesterday how if USD/JPY declined EUR/USD would go up, this is what we have seen play out today.

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The resistance level failed to provided a reversal with the market instead moving up to the highs of where the down-move originated from. When it reached the lower sections of the highs the market began getting engulfed, this new down-move, which is still taking place now has pushed the market down enough so that it has created a bearish pin bar on the daily chart.

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There’s a pretty good chance the market will move back to the lows because of the bearish pin, if you decide not to take the bearish pin and instead want to get a better entry short with a tighter stop the resistance level marked in the first image is the point where you will need to keep a lookout for price action signals.


AUD/USD – Broken Daily Supply


The supply zone AUD/USD has just entered yesterday has been broken, the highs of the consolidation are now in danger of being broken.

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There were a few attempts to break lower when the market entered the supply zone but these all failed and the market proceed to climb out of the zone, now we need to focus on the resistance level in the image, if the market breaks this level then its possible we could be in store for significant upside on AUD/USD, judging by today’s bullish large range candle I would assume its highly likely this will be the case.

As far a looking for trades is concerned I would personally watch the support level marked above. This move higher is way overextended, its only a matter of time before the market begins to fall, the support is the first place the market will encounter where buyers are likely to step in and stop the market from moving lower.


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