Last Thursday’s signals produced an excellent, profitable short trade following the bearish pin candlestick which rejected the resistance level I had identified at 0.6500. This is still running and in profit and perhaps it would be wise to exit the remainder of the position if/when the price gets established above the resistance level at 0.6449.
Today’s NZD/USD Signals
Risk 0.75%.
Trades must be entered from 8am to 5pm Tokyo time, over the next 24-hour period only.
Short Trades
Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6449 or 0.6500.
Put 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.
Long Trade
Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6374.
Put 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.
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 there was every reason to remain bearish on this pair today as the USD was still advancing very strongly here on the short-term time frames. The price was at a 2.5-year low and looked set to continue down having broken below the psychologically important 0.6500 level. This was a good call as the price has continued to fall since then but is beginning to show some initial signs that it might break up above the nearest resistance level at 0.6449. Conversely, if this level holds, the price is quite likely to continue downwards.
There is nothing important due today concerning either the NZD or the USD. It is a public holiday in the U.S.A. today.