Market Commentary 07/12/16

EUR/USD – Rising Back Into Sell Zone

The move out of the sell zone we we’re seeing take place yesterday came to an end today, and the market has now risen back into the zone and is making it’s way towards Monday’s high.

At the moment the up-move looks a little weak with only small candlesticks forming so far. I think if the market is going to break through the high some bigger bullish candles need to form otherwise we could see another move out of the sell zone take place tonight or tomorrow. Unfortunately the move out of the sell zone which came to an end today did not hit the support area where we we’re watching for entries into long trades, hopefully the current move up manages to breach Monday’s high as that would create a demand zone at the point where today’s up-move began we can use to watch for entries long.

For now just continue watching to see if the market is able to break through Monday’s high, if it does expect more upside but make sure you watch for signs of a reversal taking place when the market reaches the 1.08000 level.

USD/JPY – Falling From Supply Zone

The supply zone which formed as a result of the market failing to break through last Thursday’s highs has been hit today, and the market is now falling back to the demand zone which caused the move up into the supply to occur in the first place.

Overall I think we are going to see the market now fall back down to the demand zone seen at the bottom of the image. This demand zone marked the last point where the banks could have got a large number of their buy trades placed into the market, if they are making the price fall in order get more of their buy trades placed, it’s likely the fall will terminate somewhere inside the lower demand zone as this is where their other trades have been placed.

Don’t worry if you couldn’t get a short entry placed into this move down, it’s likely we’ll see a small reaction take place when the market reaches the demand zone closest to the current market price. This reaction may push the market back up to where the supply zone formed or it may push it up to a new supply zone which has yet to form due to the current move lower.

AUD/USD – Sharp Move Back Into Sell Zone

A big drop into the orange demand zone I said to watch for entries long in yesterday’s post occurred last night and has ended up pushing the market back into the sell zone which caused the move down to take place.

I think we have to monitor AUD/USD carefully now because the large up-move which occurred an hour ago may cause the market to break through the sell zone that’s caused the two big previous drops to take place. A break through this zone would suggest we are going to see more upside over the coming days and would also be a signal we may see the market move back to the supply zone found between the 0.7556 – 0.7580 levels.

It would have been tough to get an entry long into this move up when the market entered the orange demand zone due to no bullish engulfing candles forming, but I think we will see another retracement occur when the market breaks through the sell zone which will maybe allow us to get a long trade placed.

Finding Supply & Demand Zones That Work!

How Old Supply And Demand Zones Do Not Cause The Market To Reverse And The Reason Why ﻿Traders ﻿Mistakenly ﻿Believe They Do

Why The Time It Takes For The Market To Return To A Supply Or Demand Zone Will Determine Weather The Zone Has A High Chance Of Causing A Reversal To Take Place

The Differences Between Zones Created By Bank Traders Taking Profits And Zones Created by The Bank Traders Placing Trades