NZD/USD Forex Signal - 6 February 2019

Yesterday’s signals were not triggered, as there was no bullish price action at 0.6873.

Today’s NZD/USD Signals

Risk 0.75%.

Trades may only be taken from 8am New York time to 5pm Tokyo time today only.

Short Trades

  • Go short immediately upon the next touch of 0.6871 or 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 Trade

  • Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6802.

  • 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 price was stuck and quite evenly balanced. This meant it was probably unwise to be in any trades until the price gets out of this range between 0.6873 and 0.6901. However, I was comfortable taking a bullish bias above 0.6873, which turned out to be a bad call. I was right that a break out of the range would probably produce stronger directional movement though, as we have seen the price fall further than the 0.6873 level once the price got below it. Part of the reason for the fall was the NZD being dragged down by a strongly falling AUD, as well as the general strength of the USD.

The picture now is more bearish, despite medium-term strength in the USD, so I would be comfortable taking a bearish bias following a rejection of either of the nearby resistance levels.NZDUSDRegarding the NZD, there will be releases of Employment Change and Unemployment Rate data at 9:45pm London time. Regarding the USD, the Chair of the Federal Reserve will be making a minor speech at Midnight.

Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.