NZD/USD Forex Signal

17 July 2017 9:37:38 AM

 By: DailyForex.com

Last Thursday’s signals may have produced a short trade following the very large bearish outside candle rejecting the resistance level identified at 0.7359. It would probably be a good idea to take profit here if not done so already, or at least to take the risk off the trade by taking partial profit.

Today’s NZD/USD Signals

Risk 0.50%

Trades may only be entered between 8am New York time and 5pm Tokyo time, over the next 24-hour period.

Long Trade 1

  • Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 0.7280.
  • Place the stop loss 1 pip below the local swing low.
  • 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 run.

Short Trade 1

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 0.7359.
  • 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 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

We saw a bullish breakout from a bearish channel towards the end of last week, but subsequently a bearish short-term triple top was formed at the key resistance level of 0.7359. The pair is clearly less bullish that its “sister” pair AUD/USD. Furthermore, the area around 0.7359 has been strong long-term resistance, although we are in a minor bullish trend, without any doubt. Although the long yield on this pair is about as good as it gets, and so this pair remains a vehicle for traders wanting to short the U.S. Dollar, I do not see it as providing much opportunity today. Nevertheless, if New Zealand CPI data later comes in significantly stronger than expected, the price would be likely to break up past the resistance, although it may just be a spike providing a fast fading opportunity.NZDUSD

There is nothing due today concerning the USD. Regarding the NZD, there will be a release of CPI data at 11:45pm London time.

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment. Learn more from Adam in his free lessons at FX Academy.

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