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Patience pays as a trader.
If you saw my March 24th post on the NZDUSD, you know I have been anticipating a move higher from the pair.
I wasn’t necessarily interested in buying the New Zealand dollar, but I was looking to short it from higher levels.
The first key resistance level was 0.5920.
We can see how this area has influenced the NZDUSD to some degree recently, but it never produced a selling opportunity.
And I’m okay with that.
I’m much more interested in the confluence of resistance at 0.6200.
That’s the intersection of a twenty-year trend line from the 2000 lows and a key horizontal level that’s been in place since 2015.
I wrote about the multi-year trend line on March 13th.
I even shorted the NZDUSD in anticipation of a breakdown and announced my entry in the member forums.
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That short ran for 800 pips in just seven trading days.
After a profit like that, it’s time to wait out the next opportunity.
That opportunity, in my opinion, will materialize at or near the 0.6200 level.
A successful retest of 0.6200 as new resistance will likely attract an influx of sellers.
And if the area holds as resistance on a daily closing basis, the NZDUSD could rotate lower into 0.5920, 0.5650, and 0.5320.
We may even see an eventual run at the 2008 financial crisis lows near that 0.5000 handle.
Just keep in mind that it will take weeks and probably months for a move like that to play out.
On the flip side, if NZDUSD were to close above the 0.6200 area, it would negate the short idea.
In summary, NZDUSD is likely to move higher in the short-term toward 0.6200, at which time a favorable short opportunity could materialize.