Forex Marketz Daily Forex News – Fully Markets Update
Some points to consider in this Forex market:
- The New Zealand Dollar is trading near a two week low. No confirmation of a shift in sentiment as range support is intact.
- Risk to reward analysis argues against taking up a trade at this time.
- Trade strategy: Stand aside
The NZD/USD Forex pair has now dropped to a two low but has yet to find follow through with a breach of the range support. Price action hit a top then formed a bearish dark cloud cover candlestick, but, sellers cannot build downside momentum despite event risk on the horizon with the Federal Open Market Committee and Reserve Bank of New Zealand (FOMC and RBNZ) policy meetings on the horizon.
Technical Analysis
Let’s look at today’s NZD/USD technical analysis. Near term support is lining up near the October 21 low at 0.6697. A daily close below this level challenges the next technical support located at 0.6645. The alternative NZD/USD technical analysis, should the New Zealand Dollar recover, thus supporting this Forex market, notes technical resistance at the October 22 close (range resistance top) at 0.6791. A break above this technical level challenges the next technical resistance at the October 15 high. This level is at 0.6895.
Trade Strategy
Let’s look at today’s NZD/USD trade strategy. From a risk to reward standpoint, it is tactically inadvisable to enter a long or short NZD trade at this time. Position is inconclusive that this pullback (which is two weeks long) has been confirmed. This could be positioning for a medium term recovery instead of a broader base NZD/USD pullback. Furthermore, the NZD is trading too close to a technical support level and there is event risk on the horizon with both the FOMC and RBNZ policy meetings. Taking all of this into account, I am flat in the NZD/USD Forex market for the time being.
