Equity markets under pressure as presidential debate has the world scratching their heads on what unfolded. We can expect money flowing back into the DXY for safety which will weaken all denominated pairs like NZD/USD.

The daily chart is now consolidating below the multi-month trend line break where we can expect some further downside pressure to 0.65000. In the short – term, NZD/USD has the 50 EMA to break for confirmation.

 
Key Points:

• Price holding below the 200 EMA
• Price hugging above the 50 EMA
• Daily – Trend line break and consolidation as a flag for continuation downside.
• RSI has crossed below the 50 mid-point
• Watching price at the next 1-hour trend line for a bounce or break. If enter as supporting entry, moving the stop to break even could be a wise move if a strong bounce occurs.

 
Key Levels:
Support – 50 EMA, 0.65400, 0.65110
Resistance – 0.65910, 0.66035, 0.66120
 
Entry Zone:
Optimal entry provides the greatest reward to risk ratio while supporting entry is a zone for reversal signals.
Optimal Entry – 0.65880
Supporting Entry – 0.65785
 
Candle Reversals for entry

• Bearish Shooting Star
• Bearish Engulfing
• Bearish Dark Cloud Cover

 
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 above 0.66035 level 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 0.65880 – Target 1 0.65400 = 3x Reward to Risk
Optimal Entry 0.65880 – Target 2 0.65110 = 5x Reward to Risk
Supporting Entry 0.65785 – Target 1 0.65400 = 1.6x Reward to Risk
Supporting Entry 0.65785 – Target 2 0.65110 = 3x Reward to Risk