NZDUSD: Bearish breakdown below 0.6444
Yesterday’s signals were not triggered, as none of the key levels were reached yet.
Today’s NZD/USD Signals
Risk 0.50%.
Trades may only be entered between 8am New York time Wednesday and 5pm Tokyo time Thursday.
Short Trade Idea
Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6475 or 0.6500.
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 Idea
Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6347.
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 the support level at 0.6444 looked likely to break down eventually and if we had a strong push down by 8 am or 9am New York time I would take a bearish bias and try to catch the impulsive thrust down that was likely to follow.
This was an OK call as although the initial downwards movement reversed, it was only a normal retracement and the price is now falling again back to the same level.
It is a bearish sign that this currency pair looks weaker than the AUD/USD, although both are looking more bearish. Another bearish sign is the invalidation of the support at 0.6444. The price has a good distance it can fall without meeting obstacles. However, the inflection point at about 0.6420 may prevent the price falling below that.
I would take a bearish bias if the price is below 0.6420 at 9am New York time and falling with reasonable momentum.
There is nothing of high importance due today concerning either the NZD or the USD.