The NZDUSD is testing the conviction of sellers today. As I type this, the pair is trading at 0.7019, well above the 0.6970 key resistance level.
But for those who are familiar with the way I trade, you know that intraday price action means very little. In fact, when trading from the daily time frame, it’s meaningless.
So while the pair looks poised to take out the 0.6970 handle, nothing is confirmed until the day closes at 5 pm EST. And with five hours left in the session, anything can happen.
From here I’ll be watching to see where the NZDUSD closes the day. If sellers can push the price back below the 0.6970 area before 5 pm EST, we’ll have a bearish pin bar to consider.
On the other hand, if buyers manage to breach resistance, we could see the pair travel toward 0.7100 over the coming days.
But just to reiterate, there is nothing to do here until today’s session is behind us. And given the bearish momentum since September, selling opportunities seem most appropriate.
For full disclosure, I won’t consider trading the NZDUSD even if it carves out a bearish pin bar due to my current NZDCAD exposure, which I mentioned yesterday.
Also, keep in mind that non-farm payroll is tomorrow at 8:30 am EST. This event is one of the more volatile for the US dollar, so proceed with caution if you decide to take on USD exposure before that time.
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