Daily Price Action
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NZDUSD Approaches Key Resistance Ahead of RBNZ

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NZDUSD has gone parabolic so far in the month of June, rallying 340 pips from the May 30th low at 0.6674. But the pair is fast approaching the double top that formed between April and May at 0.7053.

While the pair failed to reach the pattern objective at 0.6550, the 0.7053 handle is without question a significant level. Also, the upper boundary of the ascending channel that extends from the August 2015 low lies just 80 pips beyond the key horizontal level.

NZDUSD ascending channel on the daily time frame

As the title of this post suggests, all of this is happening just hours before the RBNZ rate decision, which is scheduled for 5 pm EST with a presser two hours later at 7 pm.

With this in mind, it is not advisable to trade NZDUSD or any New Zealand dollar pair until the dust settles. Interest rate decisions have a long history of producing extreme levels of volatility coupled with subpar liquidity.

That being said, knowing where key support and resistance are ahead of time is always beneficial. It allows us to watch for favorable price action following the event without becoming emotionally compromised and lured in by the ensuing volatility.

If the RBNZ cuts rates or casts a dovish tone, a move lower from current levels would likely find support at 0.6950 followed by 0.6835.

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NZDUSD support and resistance levels on the daily chart

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6 comments
Leonel Ruiz says

Closed my live acct in forex today, lost one third, enough for now.
Who is your favorite broker?

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Jeff Wahlen says

Trade smaller positions, much smaller positions, until you get your confidence back. Favorite broker right now is fxTrade via OANDA.

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Margaret says

I feel your pain! whatever you do, don’t give up. You may step away for a few days to refresh.Trade smaller sizes. Winners don’t quit.

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Hank Wilson says

I let myself get “emotionally comprimised like Justin says NOT to. Duh i’m my own worst enemy and took a beat down. I can afford to lose the amount in play but what a dumb thing to do. I lost all my gains for the weak and ended my impressive win streak by being over confident that I could foresee the market ‘s next move. Note to self follow the wait and see and settle for what is apparent instead of flying by seat of the pants and trading beforehand. Will lick my wounds and search for strength in moments of introspection.

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Joseph says

Demo, Demo, Demo, don’t give up, just get better.

Smaller position sizes, give yourself a chance.

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Mimi says

Demo is the worst to use if you try to learn Forex as it’s not real money and most new traders abuse demo’s. I started learning on a live account with small volume and have not wiped out an account and my balance is growing very nicely.

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