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Today’s price action finally gave us a confirmed double top for NZDJPY. With a close about 90 pips below the neckline, the pattern is confirmed and could set up a nice short opportunity.
The ideal setup would be for the pair to retest the neckline as resistance. This would provide us with a great opportunity to go short. However looking at the current price action, I’m not so sure the market has the legs to get back to the 85.80 area.
That said, I’m not willing to chase the market lower. Therefore I will stand aside for now to see if the bulls can push this market back to a favorable level for a short setup.
Summary: Wait for a retest of the neckline as new resistance before considering a short entry. The next support levels come in at 84.0 and the measured objective of 82.0.
EURNZD has looked impressive ever since retesting former trend line resistance as new support on September 22nd. Since that time the market has rallied for 700 pips and broken through two key resistance levels.
One of those former resistance levels sits just 80 pips below the current price. That level resides at 1.625 and could provide support over the next few days. Of course we’ll need to see bullish price action on a retest to confirm that the level is likely to hold.
Summary: Wait for a possible retest of new support at 1.625 and watch for bullish price action. There isn’t much in the way in terms of key resistance until the December 2013 highs at 1.690. The year open at 1.6720 could also act as resistance going forward.
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