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NZDUSD: Start of a New Trend?

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On July 1st, I wrote about a bullish scenario for NZDUSD.

The false break between March and May hinted at a push higher.

NZDUSD was trading at 0.6458 when I wrote that post.

The pair was also coming off of the 0.6380 support are that had attracted buyers since mid-June.

Fast forward to today, and you can see that the New Zealand dollar is trading more than 100 pips higher.

It has also broken above the 0.6550 level I mentioned in Sunday’s video.

If you saw that video, you know that 0.6550 is the location of the trend line that extends from the 2014 high.

NZDUSD false break on the monthly time frame
NZDUSD monthly time frame

Now it’s time to see if NZDUSD bulls can defend the 0.6550 area as new support.

If the pair can stay above that area on a daily closing basis, a move up to 0.6640 and eventually 0.6740 seems likely.

On the other hand, if NZDUSD closes (the day) below 0.6550, it would signal weakness and also re-expose 0.6380.

Keep in mind too that this breakout may require a weekly close as confirmation.

Multi-year levels like this often require confirmation on the weekly and monthly time frames rather than just the daily.

In other words, keep an eye on Friday’s closing price, which is only a few hours away.

A Friday close above 0.6550 will keep buyers in control for next week.

But a weekly close below 0.6550 would suggest that the area is still serving as resistance on a weekly closing basis.

Disclaimer: I hold an NZDUSD long position from 0.6497.

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NZDUSD daily time frame showing support and resistance
NZDUSD daily time frame

Leave a Comment:

9 comments
Justin Bennett says

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sheikh nadeem says

hi
i think it will be a false breakout, let wait for the closing

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Martin Njeru says

I have been selling their correlation currencies ie EURADUD & EURNZD coz they are in clear downtrend ALSO THE AUS200 index is on uptrend and today as per writing it was approaching an inside bar and pin bar to me this a sign of further gain to the aussie -index

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Samuel says

Thanks for this information.we keep watch.thanks

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ali says

Thanks for the excellent update sir justin.

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Olusegun Isaac says

Yes, Good Analysis Mr Justin.From Wave perspective NZDUSD pair are in Volatile point of iii of (iii) of wave 3.and still have long way to go but may Observe temporary stop over at 0.66450-0.67400 zones to bid wave (iv) farewell before progressing.Thanks a lot for drawing my attention.NZD seems to be the most strongest among the COMDOLLS these days

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Phumutso says

Weekly candle had closed above the trendline

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Mawanda Derrick says

thanks alot Justine l have also been trading GBPUSD last week thanks for that enlightenment what of VETUSD

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Dayne says

Whatever you do….Please don’t stop this service of yours – Your dedication is very much appreciated.

P.S. I dig the background music of your weekly videos…Makes me just want to murder these charts whilst at peace.
And thanks for your ‘disclaimers’ …It really helps put your analysis into perspective!

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