G’day Surfers – prepare for the sound of a broken record.
Apart from changing the numerals, I could very easily cut & paste yesterday’s Daily Brief and it would accurately reflect what transpired over the previous 24hrs. Tuesday we saw an 83 pips move South. Yesterday – 3 separate moves in the same direction, accounting for another 95 pips to test our major support level of 1.2909. Price action bounced off the support and has now settled into consolidation at around 1.2950. We had only longs on our radar due to the oversold nature of the EURO – market said “not yet” – we obeyed and stayed flat.
Blind Freddy can see the EURO is under extreme pressure and could tumble further……..much further! As intraday traders, we are very respectful of trading with the trend however – we are also ever vigilant to detect when the trend ISN’T our friend.
White (Bullish) candles are becoming as difficult to find as rocking horse droppings. H4 Chart boasts only five of the last sixteenteen and four of the five are very small bodied. Whilst it’s true the 16 candle run has realised only 153 pips for the Bears, the weight of black candles over that 52hr period, is unusual. This irregular behaviour adds another technical reason the market is due for pullback. Yes, broken record time I know but the charts talk and it’s our job to listen. Here’s the deal:
SHORT SIGNALS: Pivots/trend Bearish
LONG SIGNALS : Oversold – Open Gap – Major Trendline untested from below – Disparity in Black:White candle ratio
The most significant Bullish signal is the Oversold component. The BIG gap between Daily & Weekly Pivots is our guide here. At 200+ pips, this is not ground breaking but it’s rare for these bosom buddies to stretch this far for extended periods.
The Day Ahead
Playing the numbers game that we do, Surfing The Pips Strategy forbids us taking a short position in this overstretched situation. With two Hotspots at our disposal – we’ll continue the patience exercise and wait for setups long at either.
Have a great weekend
Geoff Pyne | Certified SurfingThePips.com Trader
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