Last Thursday’s signals produced a long trade from the bullish engulfing candle on the H1 chart bouncing at the support level identified at 0.6600, giving just a little more than the minimum 20 pips of profit.
Today’s NZD/USD Signals
Risk 0.75%.
Trades may only be taken between 8am New York time and 5pm Tokyo time, during the next 24-hour period.
Short Trade
Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6635.
Place 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.
Long Trades
Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6562 or 0.6541.
Place 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.
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 last Thursday that I saw a period of consolidation close to 0.6635 as the most likely scenario if there were no major surprises with the forthcoming data releases. There was no such surprise, but the price broke down below most of the support and is now definitively bearish, as is almost everything else against the U.S. Dollar over recent hours as the market goes “risk off”. It is notable that the NZD is holding up better than many other currencies, which is a sign of underlying relative bullishness. The short-term momentum and the technical picture are both with the bears, but when the market eventually turns against the USD, it is likely that we will see a healthy rise here.
Regarding the USD, the Chair of the Federal Reserve will be giving a minor speech at 3pm London time. There is nothing important due today concerning the NZD.