By: John Ursus
Timeframe: W1 Recommendation: Short Position
Entry Zone: 0.8650 – 0.8700
Take Profit Zone: 0.8050 – 0.8100
Stop Loss Zone: 0.8800 – 0.8850
The NZDUSD has rallied sharply over the past nine months which came on the back of a much stronger economy out of New Zealand which boosted the New Zealand Dollar. The unexpected economic strength our of New Zealand has allowed the Reserve Bank of New Zealand to increase interest rates to 3.00% which further provided reason for the New Zealand Dollar to rally.
Price action took the NZDUSD into a very strong area of resistance and given the current market forces it is unlikely that this currency pair will extend its strong upward move without a correction. Forex traders should be prepared for a pullback as existing long positions are expected to be closed for profits.
