NZDUSD: Bulls holding up above 0.6382
Yesterday’s signals produced a profitable long trade following the bullish rejection of the support level I identified at 0.6390, although it gave little more than the minimum 20 pips of profit.
Today’s NZD/USD Signals
Risk 0.50%.
Trades may only be taken between 8am New York time Thursday and 5pm Tokyo time Friday.
Short Trade Ideas
⦁ Go short following bearish price action on the H1 time frame immediately upon the next touch of 0.6430 or 0.6475.
⦁ Put the stop loss 1 pip above the local swing high.
⦁ Adjust the stop loss to break even once the trade is 20 pips in profit.
⦁ Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
Long Trade Idea
⦁ Go long following bullish price action on the H1 time frame immediately upon the next touch of 0.6382, 0.6344, or 0.6315.
⦁ Put the stop loss 1 pip above the local swing high.
⦁ Adjust the stop loss to break even once the trade is 20 pips in profit.
⦁ Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
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 still holding up above the new higher support level at 0.6390 and the longer it did so, the more likely a continuation of the upwards move was to happen. The price has held up, although the support level has needed to be adjusted down by a few pips, suggesting that the price is most likely to rise at least a bit further. The price holding up is more impressive considering that the AUD was hit earlier today which usually would also have more of a negative impact on the NZD. So overall, we have some bullish signs.
Despite these bullish developments, and the medium to long-term bullish trend, we still have reasons to expect a major bearish reversal in this area between 0.6450 and 0.6500, so the price may not rise a great deal further.
I take a bullish bias today on this currency pair as long as the price is between 0.6382 and 0.6430.
There is nothing of high importance due today regarding the AUD. Concerning the USD, there will be a release of PPI data at 1:30pm London time, followed by testimony by the Chair of the Federal Reserve before Congress at 3pm.