Another fairly quiet day today across the Forex market. The Aussie Dollar is the only currency that made any real moves today. That and USDJPY, which I was out of this morning a little better than break even. We didn’t quite get the retest of 101.50 like I thought we would, but no harm done.
With the FOMC meeting tomorrow, it seems this is the calm before the storm. So with an increase in activity on the way, let’s take a look at a few currency pairs with levels of interest.
NZDJPY has been in a very tight range for the past several days. At the moment price is riding along the top of the trend line from April 1st. Considering the market’s refusal to give up any ground after the strong rally on June 12th, and the strong bullish momentum on the weekly chart, I’m favoring a break to the upside here.
Unfortunately there isn’t much for us to trade at the moment. It’s true that June 13th is an inside bar, but with resistance just above current levels this isn’t a valid setup for me. Even with a break of the mother bar on June 12th, the odds of a false break are too great to justify the risk in my opinion.
However, a break and close above this level with a retest as new support could make for a great setup. We’ll have to wait and see what the next few days give us.
I tweeted about AUDJPY earlier today, saying that we might get that pullback to 94.55 after all. If you’ll remember I posted about AUDJPY reacting to resistance on June 11th here.
The 94.55 level is important because not only has it served as a key level going all the way back to January of last year, but it’s also the 50% retracement from the May 21st low to the June 13th high. Any price action at this level could make for an interesting setup.
Speaking of levels that may become interesting, AUDNZD is approaching a level of interest. The 1.0755 level has served as support and resistance for several months now. We’re also seeing a trend line develop that intersects with our key horizontal level, adding confluence to this area.
We’ll have to wait and see what kind of price action forms in the days ahead.
I’ve been watching the EURNZD bearish inside bar for a few days now. The market has really stalled out and is now trading within a tight range as shown in the chart below.
At this point I’m entertaining other setups. The market may still break down from here, but I was looking for the bearish momentum to continue from the drop on June 12th; which didn’t play out.
Another scenario is that the market retraces back to 1.5830, in which case we can look for a price action sell signal to rejoin the trend.