Yesterday’s signals produced a profitable short trade from the bearish inside candlestick which rejected the resistance level I identified at 0.6899.
Today’s NZD/USD Signals
Risk 0.75%.
Trades may only be entered from 8am New York time until 5pm Tokyo time, over the next 24-hour period.
Short Trade
Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6899.
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.
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 a sustained break above 0.6900 would be a relatively bullish sign, but I thought that this pair was best avoided by traders and I took no directional bias. This was unfortunate, as the resistance level I had identified at 0.6899 held nicely and has produced a meaningful downwards movement which looks likely to continue for a while. There are no obvious key support levels below for a long way down, so the price could keep falling and falling. This could be a short trade worth letting ride. I have a cautiously bearish bias until 0.6840, which could hold as a previous bullish inflection point.
There is nothing important due today concerning the NZD. Regarding the USD, there will be a release of PPI data at 1:30pm London time.