Last Monday’s signals were not triggered as there was insufficiently bullish price action at 0.6804 and no price action at 0.6789.
Today’s NZD/USD Signals
Risk 0.75%.
Trades may only be entered from 8am New York time Wednesday until 5pm Tokyo time Thursday.
Short Trades
Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6804 or 0.6856.
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 run.
Long Trade
Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6774.
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 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 saw the price as equally likely to move in either direction, being currently positioned right in the middle of a fairly wide range between support and resistance. I thought a strong reversal later from any of the nearby levels might be a good trade, but I had no directional bias. This was arguably a good call as the price first fell to new lows before rising quite firmly again, dragged up by the boost from the Australian Dollar after stronger than expected Australian Retail Sales data was released.
Today’s pivotal level is likely to be 0.6804. I would take a cautious bearish bias if there were a strong bearish reversal here, partly because it is confluent with the round number at 0.6800, and partly because the price here returns to the area where it was trading when the RBNZ announced a more dovish approach to monetary policy might be ahead. There is nothing of high importance due today concerning either the NZD or the USD.