NZDUSD analysis: Bullish after significant higher low at 0.6500
Last Thursday’s signals were not triggered, as the bullish price action took place below 0.6508.
Today’s NZD/USD Signals
Risk 0.75%.
Trades may only be taken from 8am New York time Monday and 5pm Tokyo time Tuesday.
Short Trade
Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6592.
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 Trades
Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6544 or 0.6528.
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 last Thursday that the short-term price action had become bullish, suggesting that the resistance level at 0.6526 would be broken very soon. That would be a bullish sign and a sustained break of 0.6540 would be an even more bullish sign. This bottom at 0.6500, if it held, could be a very significant first higher low in a major long-term bullish move from the recent multi-month low prices we had seen not long ago.
This was a good and accurate call, although it took longer than I had expected for the price to breach 0.6526 which did not happen until Friday. The price now is trying to make new multi-day high prices above the swing high at about 0.6560. The short-term bullish momentum is strong, and the price has a good distance it can rise without hitting any resistance, as there is no key level above until 0.6592. However, a bearish pullback at 0.6560 is quite possible.
I would take a bullish bias later if we get a very strong bullish bounce at 0.6544.
There is nothing important due today concerning the NZD. Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.