Forex Strategy: NZD/USD Bulls Lose Momentum Following Doji Formation
- NZD/USD Technical Strategy: Sidelines Preferred
- Doji signaled indecision near key 0.8700 handle
- Uptrend remains intact on daily cautioning against shorts
The NZD/USD has conducted an about-face following several failed attempts at a breakout above its 2013 high near 0.8700. The Doji noted in yesterday’s candlesticks report helped signal fading momentum amongst the bulls. At this stage there appears to be some buying support around the psychologically-significant 0.8600 handle which may slow declines. However, caution is suggested when looking at shorts, given that the uptrend remains intact.
NZD/USD: Bulls Lose Momentum Following Doji Formation
Daily Chart - Created Using FXCM Marketscope 2.0
Drilling down to examine intraday price action; an Inverted Hammer is forming near 0.8585 which could hint at bounce over the remainder of the session. However, the candle has yet to close and would require a successive up-period to be validated.
NZD/USD: Buyers Emerge Near 0.8585
Four Hour Chart - Created Using FXCM Marketscope 2.0
The Gravestone Doji on the weekly has failed to receive confirmation from a successive down period. With prices in a continued uptrend a break above 0.8665 would favor longs with a target near resistance at 0.8830.
NZD/USD: Reversal Signal Lacking
Weekly Chart - Created Using FXCM Marketscope 2.0
By David de Ferranti, Market Analyst, FXCM
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