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Important: This site uses New York Close Forex Charts so that each 24-hour session starts and ends at 5 pm EST. These charts are essential for trading price action.
The short-term downtrend on NZDUSD began on March 21st.
That was when the pair reached the range resistance that has been in place since January.
And at the other end, NZDUSD just recently bounced from range support.
Here’s a view of that 350 pip range:
During this latest selloff, the pair has carved a descending channel.
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The 4-hour time frame shows the pattern best.
Now, I’m by no means saying the NZDUSD is about to turn higher.
But it is imperative that sellers keep prices inside this channel in order to maintain the short-term bearish momentum.
If buyers manage a 4-hour close above channel resistance, we could see NZDUSD pop higher to at least the 0.6720 region.
For now, though, all eyes are (back) on range support at 0.6590.
If that support level fails on a daily closing basis, we could be looking at another run at 0.6510 and perhaps 0.6430.
Regardless of where the pair goes from here, though, I think the 4-hour channel below is worth keeping an eye on.
The NZDUSD is one for my watch list, but not much more than that.
I don’t want to short the pair above range support at 0.6590.
At the same time, I’m not willing to play the 350 pip range as long as the price is below channel resistance.
With that in mind, I’ll remain a spectator until I have a reason to act.
Justin Bennett is an internationally recognized Forex trader with 10+ years of experience. He's been interviewed by Stocks & Commodities Magazine as a featured trader for the month and is mentioned weekly by Forex Factory next to publications from CNN and Bloomberg. Justin created Daily Price Action in 2014 and has since grown the monthly readership to over 100,000 Forex traders and has personally mentored more than 3,000 students.Read more...
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