NZD/USD forming within the trend channel for further upside into 0.66880 and as high as 0.67350.

NZD/USD

A breakout of the yellow trend line is desirable for entry confirming bullish momentum for NZD/USD, but don’t be afraid to add a position at the 50 EMA retest.  

nzd/usd

Investors await for news on Donald Trumps health to make definitive decisions on where to park their investments. A healthy D. Trump could mean money pour out of the US dollar and back into higher risk assets like equities forcing US denominated currencies to strengthen. 

 

Key Points:

  • Price holding above the 200 EMA on 1hour and 4hour time frame
  • Price holding above the 50 EMA on 1hour and 4hour time frame
  • Fibonacci 61.8% as price target but as high as 78.6% for max zone of distribution (Sep 18 high – Sep 24 low range)
  • Lower trend line can be tested within this channel but be sure not to cut unless price closes below the 4 hour 200 EMA or trend line.

 

Key Levels:

Support – 0.66200, 50 EMA, 200 EMA

Resistance – 0.66880, 0.67350

 

Entry Zone:

Optimal entry provides the greatest reward to risk ratio while supporting entry is a zone for reversal signals.

Optimal Entry – 0.66391

Supporting Entry – 0.66500

 

Candle Reversals for entry

  • Bullish Hammer
  • Bullish Engulfing
  • Bullish PiercingCandlestick

 

The Risk:

As traders, it is your job to mitigate the risk and only trade structures that provide high probability and great reward to risk ratios.

If you are not comfortable with defined exit levels, experiment with Moving Averages to help set solid exit rules to protect your capital.

 

IF: Price breaks below 0.66073 and violates 200 EMA – this would suggest the structure is not in our favour and would be wise to reduce exposure or close the trade until a solid signal gives us reasons to re-enter.

 

Reward / Reward Targets:

Optimal Entry 0.66391 – Target 1 0.66880 =1.5x Reward to Risk

Optimal Entry 0.66391 – Target 2 0.67350 = 3x Reward to Risk

Supporting Entry 0.66500 – Target 1 0.66880 = 1x Reward to Risk

Supporting Entry 0.66500 – Target 2 0.67350 = 2x Reward to Risk