NZDUSD: Medium-term topping out?
Last Thursday’s signals were not triggered, as there was insufficiently bearish price action at either 0.6348 or 0.6365.
Today’s NZD/USD Signals
Risk 0.50%.
Trades may only be taken between 8am New York time Tuesday and 5pm Tokyo time Wednesday only.
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 0.6386 or 0.6354.
- 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 I thought ranging conditions would prevail in this currency pair. I was wrong, as we instead got a reasonably strong bullish movement instead. The price action does not suggest that the price is quite ready to fall significantly yet, but a look at the daily chart shows that we seem to be getting a topping-out and the start of a medium-term bearish turn. However, as the U.S. Dollar is generally weak, it will probably be best to stand aside for the time being and wait to see how the situation develops with this currency pair.
It is worth noting that the topping-out action looks to be stronger, and therefore more bearish, in the AUD/USD currency pair than it does here.
There is nothing of high importance due today concerning either the NZD or the USD