Euro

The USD index extended its consolidative moves through Monday. The activity come son the back of violated intraday supply level at 82.50 although the climb higher saw the contract disallowed from its next supply at 83.00/83.20 - as per the drop-base-drop from last April  -  ahead of next offers at 83.50/84.00. Intraday demand noted between 82.20/30 ahead of 81.50/82.00.

Pay attention to the index location. When it nears demand, unfilled buy orders will likely provide broad initial support to the USD, thus one may potentially increase the chances of a USD long play succeeding on such convergence. The same applies if playing USD short positions, with the odds further stacked in one's favour when the index faces supply.  

Chart LIVE available at FXstreet.com

White lines drawn represent supply/demand levels

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Below we identify the most relevant supply and demand levels as per obvious imbalances between buying and selling interest in the EUR/USD. These are areas where large institutions were active buyers and/or sellers in recent trading. Supply and demand identification is a critical tool to identify where the unfilled buy/sell orders may lie.

EUR/USD goes nowhere fast, 1.29/2930 or retest of 1.3120/40 next?

No new developments in the EUR/USD, with the supply level at 1.3120/40 -noted in several occasions in our daily report - still a sellers stronghold, while on the downside, any approach at 1.30 conventional/psychological support continues to push prices away. Should the level be broken,  fresh demand lies below in the 1.2930/1.29 area, as per the April 5th drop-base-rally, a 'level on top of level', which strengthens the case to see an initial decent bounce off the level in case a test takes place in the next sessions ahead. 

Supply and demand levels identified in the chart

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Good luck!



Note to all readers

At the most fundamental level, an exchange rate between a pair of currencies will rise because there is more demand for it, thus creating an imbalance between buying and selling interest at a particular level. On the supply side, the value of an exchange rate between two given currencies will be reduced as soon as supply exceeds demand.

The following analysis intends to dissect for the reader at FXstreet.com where large banking institutions have been recently busy buying and/or selling a particular pair and what is the likelihood of these activity continuing to show up at that particular level, with the ultimate aim of seeking to fill the remaining unfilled buy or sell orders. Note conventional technical analysis will not be conducted,with the sole focus being supply/demand areas.

No entry/stops/profit target levels will be given, as the intention ofthis report is to purely suggest where large institutions akathe smart money - insiders and better informed speculators - are mostlikely to be actively selling or buying. Any trader should factor inadditional elements in order to understand the potentiality ofsuccess from a particular area. To learn more about supply and demand visit Sam Seiden's articles and webinars.