News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Bearish
Wall Street
Bearish
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Bearish
More View more
Real Time News
  • Heads Up:🇯🇵 Consumer Confidence (OCT) due at 05:00 GMT (15min) Previous: 32.7 https://www.dailyfx.com/economic-calendar#2020-10-29
  • Fear has reared its ugly head this past session. Will a fire burn when for risk assets like the Dow even as attention is drawn forward to next week's Presidential election? I discuss my views in today's trading video: https://www.dailyfx.com/forex/video/daily_news_report/2020/10/29/Dow-and-Nasdaq-Enter-Technical-Corrections-Dollar-Plays-Safe-Haven-Ahead-of-GDP-and-FAANGs.html?ref-author=Kicklighter&QPID=917719&CHID=9 https://t.co/KYexqG2pEa
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.86%, while traders in NZD/USD are at opposite extremes with 69.17%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/yOLbxwOKhF
  • The Indian #Rupee may weaken following a breakout higher in $USDINR over the past 24 hours. Despite rising global stock market volatility, the #nifty50 has been holding its ground. Could it capitulate lower? - https://www.dailyfx.com/forex/technical/article/special_report/2020/10/29/Indian-Rupee-Nifty-50-Forecast-USDINR-Breakout-as-Volatility-Spikes.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/GPQSQMvUsn
  • Forex Update: As of 04:00, these are your best and worst performers based on the London trading schedule: 🇦🇺AUD: 0.28% 🇨🇦CAD: 0.24% 🇬🇧GBP: 0.16% 🇨🇭CHF: 0.10% 🇪🇺EUR: 0.07% 🇯🇵JPY: -0.15% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/YuqROnNqY7
  • Indices Update: As of 04:00, these are your best and worst performers based on the London trading schedule: US 500: 0.95% Wall Street: 0.95% France 40: 0.56% Germany 30: 0.46% FTSE 100: 0.27% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/kACR087bkv
  • $USD Technical Analysis: $AUDUSD, $EURUSD, $GBPUSD Key Levels to Watch - https://www.dailyfx.com/forex/technical/home/analysis/us_dollar_index/2020/10/29/USD-Technical-Analysis-AUDUSD-EURUSD-GBPUSD-Key-Levels-to-Watch.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Moss&utm_campaign=twr https://t.co/qhWkEqOHVW
  • Technical indicators are chart analysis tools that can help traders better understand and act on price movement. Learn more about the importance of technical analysis here: https://t.co/NpC1D8y4Aa https://t.co/RkYUVwtuaF
  • BoJ: Risks are tilted to downside for economic, price outlook. Outlook assumes no large-scale spread of virus -BBG
  • Brush up your knowledge on trade-wars with this tool from DailyFX research briefly outlining trade-war history dating back to the early 1900s here: https://t.co/ZWaL6laTU5 https://t.co/ZhHOodO1yI
NZD/USD 2016 Rally at Risk Sub-7500 as Sentiment Stretches

NZD/USD 2016 Rally at Risk Sub-7500 as Sentiment Stretches

2016-09-08 19:13:00
Michael Boutros, Strategist
Share:
  • NZDUSD Responds to key resistance range at fresh 2016 highs
  • Updated targets & invalidation levels

NZDUSD Daily

NZD/USD 2016 Rally at Risk Sub-7500 as Sentiment Stretches

Chart Created Using TradingView

Broader Technical Outlook: Kiwi has made an initial response to the critical resistance zone highlighted in yesterday’s analyst pick at 7481-7515. “This region is defined by the 161.8% extension of the advance off the 2015 low, the 50% retracement of the July 2014 decline and basic parallel resistance extending off the June high. The long-bias is at risk near-term while below this threshold…”

The pair is now testing interim support at 7380/91 & a break here would be needed to validate a more significant reversal in the pair. Note that daily RSI has now tested & reversed off the underside of a former support trigger keeping the risk lower for now. A break lower targets key near-term support into the March 2015 low-day close / July high-day close at 7292/96.

Avoid the pitfalls of near-term trading strategies by steering clear of classic mistakes. Review these principles in the "Traits of SuccessfulTraders” series.

NZDUSD 120min

NZD/USD 2016 Rally at Risk Sub-7500 as Sentiment Stretches

Notes: We discussed this trade in today’s webinar on SB Trade Desk after noting the pair had marked bearish divergence into a support-trigger in early European trade. The decline is now hovering just above last week’s high at 7381 and is backed closely by a basic 23.6% retracement of the late- July advance at 7360. Immediate resistance stands at yesterday’s close (2016 HDC) at 7450 with our bearish invalidation level steady at 7481-7515.

From at trading standpoint I would be looking to fade strength while below key resistance with a move sub-7292/96 needed to suggest that a more significant reversal is under way. Such a scenario eyes subsequent support targets at the monthly open at 7249, 7218 & the 61.8% retracement at 7155. A quarter of the daily average true range (ATR) yields profit targets of 25-28 pips per scalp. Event risk is rather limited into the weekend with the New Zealand GDP & the U.S. Consumer Price Index (CPI) and Retail Sales highlighting the docket next week. Continue tracking this setup and more throughout the week- Subscribe to SB Trade Desk and take advantage of the DailyFX New Subscriber Discount.

NZD/USD 2016 Rally at Risk Sub-7500 as Sentiment Stretches
  • A summary of the DailyFX Speculative Sentiment Index (SSI) shows traders are net shortNZDUSD- the ratio stands at -2.66 (27% of traders are long)- bullish reading
  • Long positions are 8.6% higher than yesterday while short positions fell 15.2% over the same time period.
  • Open interest is 9.8% lower than yesterday and 13.0% above its monthly average.
  • Note that retail sentiment has come off extremes not seen since not seen July of 2014 – That was the yearly high in price (SSI registered -6.19). With that said, the pair is vulnerable for further weakness here and a continued narrowing in net positioning would further support this notion.

Help fine-tune you entries, click here to learn more about the DailyFX Grid Sight Index (GSI)

Relevant Data Releases

NZD/USD 2016 Rally at Risk Sub-7500 as Sentiment Stretches

Other Setups in Play:

Looking for trade ideas? Review DailyFX’s 2016 3Q Projections

---Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michaelon Twitter @MBForex contact him at mboutros@dailyfx.com or Click Here to be added to his email distribution list

Join Michael for Live Scalping Webinars on Mondays on DailyFX and Tuesday, Wednesday & Thursday’s on SB Trade Desk at 12:30 GMT (8:30ET)

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES