NZDUSD: Bearish price channel still holding
Yesterday’s signals were not triggered, as there was no bearish price action at 0.6347.
Today’s NZD/USD Signals
Risk 0.75%.
Trades must be entered between 8am New York time Thursday and 5pm Tokyo time Friday.
Short Trade Idea
Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6358.
Place the stop loss 1 pip above the local swing high.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
Long Trade Idea
Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6298.
Place the stop loss 1 pip above the local swing high.
Adjust the stop loss to break even once the trade is 20 pips in profit.
Remove 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 price channel was holding, every sign was bearish, and there was therefore no reason not to take a bearish bias as long as the price was below the new lower resistance level at 0.6347. This wasn’t a bad call as the downwards movement really only got going below that level. However, it has since been invalidated leaving us with a nearby resistance level at 0.6758.
The long-term bearish price channel continues to hold, so there still seems to be sufficient reason to be taking a bearish bias and looking for short trades. I would do so if we get a solid bearish reversal following a retracement to 0.6758.
Regarding the USD, there will be a release of Crude Oil Inventories data at 3:30pm London time. Concerning the NZD, there is nothing of high importance due today.