Yesterday’s signals were not triggered, as the resistance level at 0.6902 was hit only before 8am New York time. However, it capped the high of the day to the pip so seems to be an accurate level.
Today’s NZD/USD Signals
Risk 0.75%.
Trades may only be taken between 8am New York time and 5pm Tokyo time Wednesday.
Short Trade
Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6902.
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 Trades
Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6853 or 0.6833.
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 yesterday that the picture had become more bullish as we had seen a strong rise in the price, with the U.S. Dollar acting as the weakest currency generally, which suggested still higher prices. However, we were currently close to a major resistance level which was also very confluent with a round number, at 0.6902. I would not want to enter a short trade there until the price had lost its bullish momentum over several hours at least. I was wrong, as it held after only one touch, but the price has not fallen from there by much which suggests my caution was valid. The picture now is less bullish, and the NZD is more bearish that the AUD which is another bearish sign. I would be prepared to take a short from a rejection of 0.6902. As for long trades, 0.6833 looks more solid than the level at 0.6853.
There is nothing of high importance due today concerning the NZD. Regarding the USD, there will be a release of CB Consumer Confidence data at 3pm London time as well as testimony before the Senate from the Chair of the Federal Reserve.