Daily Price Action
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NZDUSD: Next Leg Lower to Materialize Below 0.5980

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I’ve been talking about the potential for a lower NZDUSD for weeks.

But despite several bearish signs, the pair has held its ground.

That isn’t too surprising, though, when you consider how correlated the NZDUSD is to indices like the S&P 500.

NZDUSD correlation to S&P 500
S&P 500 (blue) to NZDUSD (red) – daily time frame

Everyone knows how the Fed has intervened in US markets of late.

However, when you take a step back and look at the bigger picture for NZDUSD, it’s difficult to anticipate anything other than lower prices.

NZDUSD head and shoulders and breakdown on the monthly time frame
NZDUSD monthly time frame

First, the fifteen-year head and shoulders is unmistakable.

Some have questioned the validity of this pattern because of its scale, but that only adds to my conviction.

I’m more likely to believe a pattern that has taken fifteen years to develop than one that takes fifteen days or even weeks.

Furthermore, 2020 has already proved that anything is possible.

In addition to the head and shoulders, the NZDUSD broke below a twenty-year trend line in March.

Despite rebounding sharply at the end of March, the market hasn’t shown me anything to make me think it can reclaim the 0.6200 area.

As long as 0.6200 is intact as resistance, the NZDUSD is going to struggle.

And if the pair falls below 0.5980 on a daily closing basis, expect selling pressure to mount and push prices to 0.5860.

A close below that would take on 0.5650 and eventually 0.5470.

Last but not least, note that unless something changes between now and Friday, the NZDUSD is carving a bearish engulfing week near a swing high.

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

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NZDUSD ascending channel on the daily chart
NZDUSD daily time frame

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18 comments
Justin Bennett says

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Martin Njeru says

Thanks Master….. Ihave been having my short position since monday afternoon,but my position is now Insured this led to the pair loose mre due to Interest rate decision,,,,,,,,,,i am having same view
Thanks man my trading journey is improving
Stay safe, stay home we shall overcome

Reply
    Justin Bennett says

    You’re welcome.

    Reply
Martin Njeru says

If i may ask when drawing trendlines do you connect the wicks or the closing price?Thanks in advance

Reply
    Justin Bennett says

    Both, but you’re trying to catch the essence of supply/demand with the most conservative placement possible. That’s the key.

    Reply
Muhsin mohamed says

This is very good idea

Reply
    Justin Bennett says

    Glad you think so.

    Reply
sunday says

Thanks, Justin. Could there be slit pull back on 4hr. chart?

Reply
    Justin Bennett says

    Anything is possible.

    Reply
Gift Ameh says

Thanks a lot. I share same something. Well researched submission

Reply
    Gift Ameh says

    Sentiment*

    Reply
abdifitah salad says

Thank you very much for the time and resources I would like to include in the groups to help me be the right person to help me predict exactly how much money I have wasted on forex trading.

Reply
    Justin Bennett says

    You’re welcome.

    Reply
Emmanuel Ochade says

Thanks for your efforts, have been following you for some time, I can say your analysis are clear and without sentiments..,once again thanks for the good and great works you have been doing

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Mazatul Akmal says

Hello Justin..im always lose when i place the trade order..Any advise for me.

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