Yesterday we saw great volatility on the markets. It was mainly caused by eurozone decisions. Such market situations support forming of new setups and we can find lots of them today. To not bore you, I will show just four of them here.
We should also remember that at 2:30PM (CET+1) we will know the data from US labor market (NFP and unemployment rate). Let’s start today’s Price Action setups preview.
Euro to Japanese yen reacted strongly to yesterday ECB decisions. I was showing a strong support here (as a position-opening spot) which breaking below should indicate larger sell off. It seems however, that entering longs will not be a good idea, especially it would be against broader market situation and strong downtrend on EUR to USD.
Mario Draghi smashed EUR/USD yesterday and downward candle of almost 250 pips length is something that we did not see on this pair since 2011. Key support at 1.3100 was dynamically broke. There few opportunities to open short positions (after last week gap closure – I wrote about it recently). Now we can draw a next important support level at 1.280 and 1.275. Price should slip at least to the first one before larger correction. Every rebound should be used to open short positioning (the best opportunity would be last key support re-test from the bottom 1.3100).
Here we also can see decisive movements and breaking below important support. Price stopped on the next key level, which may defend further losses. During September 2013 it was really important and it could be the same now. We should remember however, that trend is downward and the last momentum show the bears nomination. Potential, really clear Price Action buying signal at the daily chart could be an excuse to open longs (but we should be careful).
Patience pays off! Buy limit position which was entered after pin bar candle forming last Friday. Now, we should wait for realization of assumed TP levels.