Yesterday’s signals were not triggered, as neither of the key levels were ever reached.
Today’s NZD/USD Signals
Risk 0.75%
Trades must be taken from 8am New York time until 5pm Tokyo time, over the next 24-hour period only.
Long Trade 1
· Long entry following a strongly bullish price action reversal on the H1 time frame immediately upon the next touch of 0.6806.
· Place the stop loss 1 pip below the local swing low.
· Adjust the stop loss to break even once the trade is 20 pips in profit.
· Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
Short Trade 1
· Short entry following some bearish price action on the H1 time frame immediately upon the next touch of 0.6938.
· Place the stop loss 1 pip above the local swing high.
· Adjust the stop loss to break even once the trade is 20 pips in profit.
· Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
NZD/USD Analysis
I wrote yesterday that I thought the price was more likely to break downwards out of the consolidating triangle shown in the chart below, meaning short trades off a further tap of the upper line would be more likely to be the best opportunity over the coming hours. This turned out to be correct, as we are now seeing what looks like being a breakdown. There is a strong medium term bearish trend, which now looks likely to carry the price down to reach the next support level at 0.6806 at least. However, I doubt that this level will be reached before the key economic data due later from New Zealand. There is also key data coming from the U.S., so the price could be pushed around chaotically later, disrupting what looks to be a natural bearish flow.
Regarding the USD, there will be a release of CB Consumer Confidence data at 3pm London time. Concerning the NZD, there will be a release of Employment Change and Unemployment Rate data at 10:45pm.