After a confident price increase, the Euro showed a smooth correction yesterday. The movement was smooth and on the small volume, so it does not cancel our previous scenario of opening long positions. Nevertheless, it is possible to open purchases only after the price growth resumed and the breakout of the new volume resistance level 1.1835.
The breakout movement must be sharp and swift, and also supported by the increased volume, which will be a more reliable signal for entering the market. A stop loss should be placed just below the breakout bar. The potential of the deal is more than 100 points.
The Pound demonstrated contradictory moves yesterday: firstly it fell down sharply, then the price rose up again. Both movements were supported by the large volume, that was evenly spread throughout the chart, so we can’t point out any new level or zone.
Beside it the price is in the middle of the local consolidation of 1.3221 – 1.3619, in which the fairly significant volume is accumulated. Thus, the best decision is just to wait for the sure exit of the pair from the range on the large volume, which will be a great signal for opening new deals.
The Yen goes on falling, but the movement was and is not significant and on the small volume. Moreover, the price is still located near the level of resistance 110.33, so our previous scenario is still actual: we can open long positions after a sharp breakout of this mark on the large volume. A stop loss should be located just below the breakout volume bar. The potential of the deal is about 100 points.
The pair continued its smooth growth and is trading near the resistance level 1.3030 at the moment, so that we can consider the scenario of its breakout. This will be a great bullish signal. The breakout movement must be sharp and supported by the large volume, which will be a more precise signal for entering the market. A stop loss should be located below the breakout volume bar. The potential of the deal is 110-120 points.
The Australian dollar dropped on the increased volume yesterday and is located in the middle of the local consolidation between the support 0.7492 and the resistance 0.7675 at the moment. Given that this range contains large volume, the best scenario is to wait for a sure exit of the pair from it. The breakout move must be swift and on the large volume, which will insure us against a fake breakout and will be a more reliable signal for entering the market.
Nothing has changed with this instrument as the pair is locked within the local range between two strong volume levels. They are the support 1282.80 and the resistance 1306.20. Also we need to point out that the large volume is accumulated in this consolidation.
Hence, we need to wait for a sure and abrupt breakout of one of the levels and exit of the pair from the consolidation. Only after that we can regard new trading scenarios here. The breakout movement must be keen and supported by the large volume, which will be a more secure signal for entering the market.
The sentiment: our deals with USD/JPY and USD/CAD are fully confirmed by the mood of the market. The situation with EUR/USD is 50/50, so we should wait for an additional confirmation signal. We need to wait for a confident exit of prices from ranges and only then we can open new deals with GBP/USD, AUD/USD and XAU/USD.