Yesterday’s signals were not triggered, as neither of the key levels were reached.
Today’s NZD/USD Signals
Risk 0.75%
Trades may only be taken from 8am New York time until 5pm Tokyo time, during the next 24-hour period.
Long Trade 1
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 0.6865.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
Short Trade 1
Go short following some bearish price action on the H1 time frame immediately upon the next touch of 0.6915.
Put the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is 20 pips in profit.
Take off 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
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 the situation with this pair was looking more bullish, due to a strong bullish “V” formation, although I was still taking a long-term bearish bias. The last 24 hours have painted a more bullish picture and I have abandoned my bearish bias. The price struggled up above 0.6880, then pulled back before rising strongly and printing a new higher support level at 0.6865. Finally, the price has already broken above the bearish trend line which can be drawn connecting the highs of the recent downwards movement, as shown in the price chart below.
There is strong bullish momentum. If the price can continue to rise and even get above 0.6934, that would be an extremely bullish sign of a major bottom in the price. It would be more typical for the rise to halt at 0.6915, although a new bearish turn would probably take several hours of price action to form, so should be approached with great caution.
I have no bias and it is likely the next opportunity in this pair will not arrive today. Volatility remains very high, yet orderly, which is a sign that the market is very interested in this currency pair now.
There is nothing important due today concerning the NZD. Regarding the USD, there will be a release of CPI and Retail Sales data at 1:30pm London time, followed by Crude Oil Inventories at 3:30pm.