NZDUSD: Slow bearish price channel
Yesterday’s signals were not triggered as the bearish price action at the bearish trend line was not sufficiently bearish to provide a good entry signal.
Today’s NZD/USD Signals
Risk 0.50%.
Trades may only be entered from 8am New York time Wednesday and 5pm Tokyo time Thursday.
Short Trade Ideas
- Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6452 or 0.6475.
- Put 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 Idea
- Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6347.
- Put 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 likely to continue moving down very slowly from a descending trend line, albeit on very low volatility. This made me generally bearish, but I wanted to see the price break below 0.6400 during the New York session before going short, and this never happened.
The price has continued to behave as I predicted, the bearish drive is getting shallower, so it seems that we are getting close to a bullish breakout above the price channel which is drawn within the chart below.
The NZD is very weak, so I would still be looking to take a bearish bias following a bearish reversal either at the upper channel trend line currently sitting at about 0.6418, or the horizontal resistance level at 0.6452 which is likely to be strong.
There is nothing of high importance due today concerning the NZD. Regarding the USD, there will be a release of FOMC Meeting Minutes at 7pm London time.