NSDUSD, 240 min
At the time of writing NZDUSD is in a downtrend as per 4h chart. The nearest important resistance level is at 0.6587 and coincides roughly with 23.6% Fibonacci level at 0.6595. In addition, the upper end of a bearish trend channel is currently at the same price levels. This could provide us with a quick short trading opportunity and as per usual we look for price action confirmation before entering the trades. Should the pair move beyond this resistance, the next potential reversal level is at 0.6637 which coincides with the 30 period SMA and is not far away from 38.2% Fibonacci level at 0.6650.
We should take into account the fact that market has been moving lower for quite some time and is trading fairly close to a pivotal support area at 0.6433-0.6490. Also, price is trading inside a daily bottoming formation from November last year. Therefore we are near a potential turn around area and we should take this into account in setting the targets. Price could enter into another sideways phase where we should look to trade accordingly and not expect the trend to continue for ever. My targets for a potential short trade are: 0.6550 (Target 1) and 0.6505 (Target 2).
Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.
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