Strategy: Short at 0.7176, Targeting 0.6992
Our NZDUSD short position at 0.7042 was stopped out last week following Friday’s daily close above 0.7150. Prices have now put in a bearish Dark Cloud Cover candlestick below support-turned-resistance at 0.7235, hinting the bears are set to make comeback. The case for a downside scenario is reinforced by bearish cues on the MSCI World Stock index, which has been closely correlated with NZDUSD as the pair tracks broad trends in risk sentiment. We will re-enter short from here, initially targeting 0.6992. A stop-loss will be activated on a daily close above 0.7263.
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