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NZDUSD: How Low Can It Go?

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On March 10th, I wrote about an NZDUSD terminal pattern.

The upper boundary of that structure extends from the 2014 high.

The lower boundary, on the other hand, dates back to the 2000 lows.

It’s no doubt a massive terminal pattern.

Here’s a view of the monthly time frame:

NZDUSD multi-year terminal pattern

Hours after I released Tuesday’s post, I announced my NZDUSD short position in the membership forums.

So far, so good, as we can see that the NZDUSD weakened by 180 pips yesterday.

That position is well in profit, and I have no intention of exiting anytime soon.

Given the significance of the wedge support that extends from the 2000 lows, a break below it could open up much lower levels.

A few of those support levels include 0.5920, 0.5650, and 0.5330.

Even the 2008 – 2009 financial crisis lows around 0.5000 could come into play.

To clarify, I’m not saying this will happen.

There are no guarantees in this game.

And even if a 1,000 pip move lower is ahead of us, I’m not insinuating it will happen within days or weeks.

Any move of that significance would likely take months to play out.

But make no mistake, a breakdown from a twenty-year support level like the one above is likely to send the New Zealand dollar much, much lower.

Could this be a false break?

Of course. As with anything in trading or life, anything is possible.

That said, as long as the NZDUSD remains below that 0.6200 area I wrote about on Tuesday, I favor shorts here.

Want to watch the NZDUSD video I just released in the member’s area?

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NZDUSD daily chart

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6 comments
Justin Bennett says

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Jane Karimi says

Thanks a mil Coach Justin. I needed some reassurance on this one as today the thought of a false break crossed my mind… as has been happening with other pairs. Now I’ll watch that level of 0.6200 as you have said. Am almost doubtless now of the move lower.

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    Justin Bennett says

    You’re welcome, Jane. There’s always a chance it could turn out to be a bear trap, but for now, things look pretty bearish for the NZDUSD.

    Reply
Colin de Ste Croix says

Yes the GFC low “could” be in play but it could also come right back up to where it was also after?!!!

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Joseph says

Hi Justin I’ll like to ask what moving average are u using and is it exponential or simple

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Sifiso says

Hi Justin. Wat a bout that long bullish pin bar?. I say before we break the low of that bar: I’m long.

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