NZDUSD: Major support level at 0.6250
Last Thursday’s signals were not triggered, as none of the key levels were reached that day.
Today’s NZD/USD Signals
Risk 0.75%.
Trades may only be taken between 8am New York time Monday until 5pm Tokyo time Tuesday.
Short Trade Idea
Short entry following bearish price action on the H1 time frame immediately upon the next touch of 0.6322.
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 Idea
Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6250.
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 last Thursday that we still seemed to have a wide-open road to the strong support at 0.6250 once the low of the past few hours got solidly broken. I was prepared to take a bearish bias if we got two consecutive hourly closes below 0.6300 after 8am New York time. We did, and this was a good call as the price fell by about another 35 pips within a short period of time, giving a profitable trade.
This currency pair is very bearish and has a clear and strong long-term bearish trend. We are approaching historic low prices. However, the price action in the hourly chart below can be seen to be turning bullish, after the price got to within a few pips of a major support and psychological level at 0.6250. This suggests we will now see a deep bullish pull back or possible even a more serious bullish reversal. However, if the level at 0.6250 is invalidated with the price getting established below it, that would be a very bearish sign, so I would take a bearish bias here if we get two consecutive hourly closes after 8am New York time below 0.6250.
There is nothing of high importance due today concerning either the USD or the NZD.