NZD/USD Forex Signal

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NZDUSD: More bearish below 0.6250

Yesterday’s signals were not triggered as there was no bullish price action at 0.6277.

Today’s NZD/USD Signals

Risk 0.50%.

Trades may only be taken between 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 0.6315 or 0.6348.
  • 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 Ideas

  • Long entry following bullish price action on the H1 time frame immediately upon the next touch of 0.6255 or 0.6195.
  • 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.

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NZD/USD Analysis

I wrote yesterday that as there was no real trend, so reversals at key levels were likely to be all we had to trade. I saw a long entry following a good bounce at 0.6255 as the best potential trade and this was a good call as the price rose from just a couple of pips above that level before trading down again.

The picture now is more bearish, and we have a very significant support level nearby at 0.6255 which is confluent with the important psychological number of 0.6250. If the price can get established below that, it is likely to fall quite strongly, so I would take a bearish bias later if we get two consecutive hourly closes below 0.6250. Upon this development I would see the slow but real long-term bearish trend reasserting itself.

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There is nothing of high importance due today concerning the NZD. Regarding the USD, there will be a release of Retail Sales data at 1:30pm London time.

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.