NZDUSD: Pivotal point at 0.6365
Last Thursday’s signals were not triggered, as the bullish price action occurred a little way below the support level identified at 0.6406.
Today’s NZD/USD Signals
Risk 0.75%.
Trades may only be entered between 8am New York time Monday and 5pm Tokyo time Tuesday.
Short Trade Ideas
Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6452, 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 Ideas
Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6406 or 0.6365.
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
The picture has become more bearish as the consolidation range between 0.6452 and 0.6406 finally broke down on Friday. The hourly chart below suggests a bearish head & shoulders formation is beginning to complete, with a neckline approximately at the already pivotal point of 0.6365. Another bearish sign is that the AUD is continuing to advance while the NZD sells off somewhat. I think 0.6365 is very likely to be hit today and could provide an interesting short trade opportunity if it breaks down, though probably after a retest from below rather than on a breakout. It can be argued that there is a long-term bearish trend in this currency pair, and a short trade would be in line with that, so I would take a bearish bias if the aforementioned scenario sets up later.
There is nothing of high importance due today concerning either the NZD or USD.