We had a wonderful trade on our last technical blog where traders were sitting pretty and have taken good profits. Last weeks sentiment on NZD/USD was very even, as the price which opened on Monday was approximately where the price closed for Friday. NZD/USD has been in a steep bearish trend before last week and we believe a trend reversal could be anytime soon.
This week we are looking for a fresh opportunity on NZD/USD, a fantastic breakout opportunity has presented itself to us and we would like to share this with you. The Kiwi is on the verge of a big move and we are looking to fill you in on how Platinum approaches this type of opportunity.
THE NEW ZEALAND DOLLAR: WHAT EVERY FOREX TRADER NEEDS TO KNOW
Fundamental Point of View on NZD/USD:
This week, we have no major fundamental news specifically for the Kiwi. Therefore, we will focus on looking at the US news will which will have a vital role in the movements for the NZD/USD.
US New Home Sales: Wednesday, 14:00.
Sales of new homes trigger wider economic activity such as spending on infrastructure and are correlated with the wider economy. After an annualized level of 694K sales in March, a small slowdown to 680K is on the cards for April.
3.FOMC Meeting Minutes: Wednesday, 14:30.
The FOMC is a key event in the Forex market and here’ why we should be looking at the event: It’s a detailed record of the FOMC’s most recent meeting, providing in-depth insights into the economic and financial conditions that influenced their vote on where to set interest rates.
The Federal Reserve publishes minutes from its meeting in early May when it decided to leave the interest rate unchanged and made some subtle changes to the statement, such as describing the inflation target as symmetric, a wording that triggered speculation that the Fed will tolerate higher rises in prices after a long period of low inflation. Markets will also want to hear a message that the June hike is on track. It is priced in.
Technical Point of View on the NZD/USD
From the daily chart, we can see the inverse head and shoulders pattern that previously formed. We have been in a steep bearish trend on this pair for the last month or so. We are now looking for a distinct reversal change. The bottom for our prediction should be the 0.6850 level, it is showing major demand with great probability of moving higher from there.
NZD/USD Forex Trading Strategy
Trade Entry: Long NZD/USD @ 0.6850 with a 40 pip stop loss with a target of 0.7080
Key Technical Levels on the NZD/USD
6930 – Short-term Selling Level
6970 – Short-term Selling Level
7040 – Short-term Selling Level
7090 – Long-term Selling Level
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Hopefully, you have enjoyed today’s article. Thanks for reading!
Have a fantastic day!
Nisha Patel
Live from the Platinum Trading Floor.