However, Asian traders, spurred by Greek PM comments saying that a second bailout package for Greece may be agreed upon before the weekend, boosted the Euro again, which currently enjoys a fresh injection of buying interest after printing its lowest at 1.3076 yesterday. The ongoing recovery has just reached new session highs at 1.3198 as trailing stops on topside above 1.3175 were recently triggered.
According to Chris Capre, Founder at 2nd Skies: “The failure to break the lows of the prior candle by more than 1pip means its unlikely to have trapped any traders short on the break.”
Thus in effect, Chris explains how it has created a two-bar trading range so “while price stays in the middle, its unlikely day traders will take heavy sides buying or selling this pair” he said, adding “they will more than likely wait for the two-bar trading range to be broken before taking any new positions. However, there are still two intraday plays.”
If you are a preferred seller and think the bears have control or will take control, Chris suggests: “You have a clear line in the sand to sell either just above 1.3200 with stops above yesterday’s high, or a possible sell around 1.3181 with stops tightly above 1.3224 targeting 1.3084 just above yesterday’s low. If the price action is corrective and timid, then this may give sellers confidence to add onto their positions or take new ones. You can watch the 1hr and 4hr for clues on this.”
If you are a preferred buyer, “then you can play off the intraday dynamic support on the 20ema for the 4hr time frame which also produced a pinbar. Stops would ideally placed tightly below yesterdays low so this gives you plays on both sides” Mr. Capre concluded.
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